Union Hanover and EquityBridge Asset Management are to capitalise on the buoyant property market by selling two yet-to-be-developed Adagio aparthotels, for more than £110m.
The two real estate investment companies have appointed Colliers International and JLL to offload the hotels. The £70m, 217-apartment property on Whitechapel Road, London, is due to open in 2016 following the conversion of the Black Lion House office building , while the £40m, 137-apartment aparthotel in Stratford, east London, is set to launch in 2018.
Adagio, which is a 50:50 joint venture between Accor and Pierre & Vacances Center Parcs Group, opened its first aparthotel in the UK in Liverpool last year. Two properties are scheduled to launch in Birmingham and Edinburgh, in addition to the two London aparthotels under development.
Eric Jafari, managing director of Union Hanover, said that the company will remain the development manager on both projects. "We have already had a number of off-market approaches by investors for the properties so we decided to capitalise on investor appetite.
"These transactions add weight to our balance sheet which we will use to improve our financing packages and profitability on the existing development pipeline of our own aparthotel brand, Urban Villa."
Will Duffey, senior vice-president at JLL Hotels said: "There is a dearth of high quality well let London hotel product currently on the market. Investors are particularly attracted to the strong returns expected to be delivered by the burgeoning extended stay market in London and Europe."
Tim Meakes, head of specialist investment at Colliers International added that the properties are well located hotels. "The edge of the City and Stratford both have seen lots of regeneration and present strong growth stories, and both are very well served by excellent transport links."