Council Buys Croydon Park Hotel for £30m
Date: September 2018
Location: Croydon, Surrey, UK
Name: Croydon Park Hotel – four star
No. of Keys: 211
Seller: Evans Randall Investors, who bought the hotel five years back for £18.2m
Buyer: Croydon Council. The council says the investment will provide a secure income stream. Dalata bought a leasehold interest in the hotel in 2016, saying it would brand the property, but sold it a little over a year later.
The private equity company put the hotel on the market for £25m in June, having acquired the freehold less than five years ago, and has received above the asking price in a deal which continues the trend of increasing council investment in real estate.
Dalata Hotel Group sold Kasterlee UK, the company which held the leasehold interest in the Croydon Park Hotel, in 2017 having acquired it as part of a four hotel portfolio for €40m (£35m).
The hotel sits on a 1.54 acre site in Croydon’s commercial district, close to the retail scheme being developed by Unbail-Rodamco-Westfield and Hammerson.
Bought as a distressed asset from Ireland’s National Asset Management Agency (NAMA), Croydon Park Hotel has delivered substantial income returns for Evans Randall and recently undergone long-term asset management initiatives including an extension of the hotel.
It also has the potential for a future change of use to residential.
Kent Gardner, chief executive of Evans Randall Investors, said: “We are delighted to have completed the sale of the Croydon Park Hotel. Throughout our ownership we have secured excellent income and capital growth and we now see this as the right time in the cycle to exit. In Croydon Council, we know we have found the ideal investor to take this property forward and ensure it continues to make a valuable and strategic contribution to Croydon town centre.”
Evans Randall Investors was represented by CBRE.
Price: £29.8m
Price per Key: £141,232
THPT Comment: Since when did local councils start buying hotels as an income stream?
First Seen: Property Week