Quintain Estates and Development has sold a 50% interest in the four-star Hilton London Wembley Hotel to funds managed by Oaktree Capital Management.
Quintain Estates and Development has sold a 50% interest in the four-star Hilton London Wembley Hotel to funds managed by Oaktree Capital Management.
Quintain’s gross proceeds from the transaction are £30 mln (€35 mln), which is in line with the valuation at 30 September 2012 for a 50% interest in the property.
Under the terms of the transaction, Oaktree will receive a preferred return, with Quintain receiving an increasing share of the income stream once the preferred return has been paid, which is envisaged for the 2014/15 financial year.
The owners said that they intend to introduce non-recourse senior debt to the joint venture in due course to re-finance part of their equity investment.
The new 361-bedroom hotel, which opened in July, sits at the heart of Quintain’s wider Wembley regeneration scheme. The hotel includes an indoor pool, steam room, sauna, gym and a business centre. It has the capacity to host events for up to 700 guests in its conferencing and events facilities, which include ten meeting rooms and a ballroom.
Max James, Chief Executive of Quintain, said the sale forms an important part of the company's strategy to reduce net debt to below £400 mln whilst enabling Quintain to participate further in the potential upside from the Hilton’s maturing business profile.
'The opening of the London Designer Outlet later this year, a revitalised Wembley Arena and Wembley’s emerging position as a new, dynamic retail and leisure destination within London will all contribute to the success of the new hotel,' he said.
