Travelodge Woolwich sold for £8m

The freehold of the 120-bedroom Travelodge hotel in Woolwich, South West London, has been sold to an overseas investor for £8m.

Sold by Powis Street Estates, the transaction represents a net initial yield of 6.75%. The hotel opened in July 2012 and will continue to be let to Travelodge on a 25-year lease.

Tony O'Brien, UK development director for Travelodge said: "Very few investment sales have happened since Travelodge's financial restructure and change in ownership last autumn, so it has been difficult to assess where yields currently sit for the Travelodge covenant. This is a good indication and several other investment sales are in solicitors' hands which should provide a better picture shortly.

Travelodge is currently in the middle of a £57m refurbishment programme which includes the introduction of a new room design. More than 5,000 of its 30,000 bedrooms have been completed, more than half of the estate completed by the end of the year. Summer 2014 will see 85% of the bedrooms featuring the new design.

Colliers International and Cradick Retail acted as joint agents for the sale.

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