LaSalle Investment Management (LaSalle) has purchased the freehold reversion of Crowne Plaza Blackfriars, a 204 key upscale hotel in London’s Blackfriars, on behalf of a separate account client, from Blackfriars Hotel (UK) Holdings. Financial details were not disclosed.
The transaction will fund the refurbishment, repositioning and rebranding of the hotel under the Hyatt Regency brand, the second in London.
Located in the Blackfriars area of the City of London, the building was originally constructed in 1916 as offices for Spicer Brothers Paper Merchants. The building was fully redeveloped to create the four-star Blackfriars hotel in 1998.
The acquisition of the Blackfriars hotel incorporates a structure to provide additional liquidity to invest and reposition the hotel and acquire others.
Kerr Young, director, JLL, Hotels and Hospitality, said: ‘Despite the impact of covid on operating performance, we are witnessing record levels of demand from investors to deploy capital into UK hotel real estate. Having explored a variety of options on behalf our client we were able to structure a transaction that allowed for the release of equity from the asset, whilst retaining longer term ownership.’
‘As one of the world’s leading tourist and business hubs, the London hotel market was disproportionately impacted by the pandemic, but as the recovery takes shape the return of visitors to the capital is on the horizon,’ added Will Kirkpatrick, head of Hotels at Gerald Eve. ‘This will not happen overnight, and the deal has been structured to provide additional liquidity throughout the recovery, but for a long-term investor such as LaSalle, this deal represents an excellent opportunity to acquire a landmark hotel in the City and capitalise on London’s return to its rightful place among the world’s ‘must-visit’ destinations.’
Robin James, head of Transactions UK & Ireland at LaSalle commented: ‘We are delighted to have acquired the freehold interest of this substantial Central London island site. The structure will allow for the redevelopment and rebranding of the hotel, whilst delivering a long-term, inflation-linked income stream for our client. The location and quality of the property provides confidence in its long-term income generating capabilities and value, whilst ensuring the rent received from the operator remains sustainable.’
Gerald Eve and Mills & Reeve advised LaSalle, while JLL and CMS acted on behalf Blackfriars Hotel (UK) Holdings.
