Date: November 2017, put on the market May 2017, completed December 13th 2017
Location: 37 hotels in UK & Ireland and Czech Republic
Name: Jurys Inn Hotel Group and Hilton Garden Inn Heathrow, UK
Number of Keys: 4694 (21 hotels)
Seller: Lone Star Funds, who held off on its debt restructuring efforts once the investor added the Jury’s Inn chain to its portfolio following a transaction with the Oman Investment Fund, Mount Kellett Capital Management, Ulster Bank, Westmont Hospitality Group and Avestus Capital Partners.
Lone Star bought the Jury’s Inn hotel chain in a GBP680m deal in 2015. The acquisition included the brand, along with an estate of 25 hotels in the UK, five in Ireland and an outpost in Prague.
It has invested over £100 million since then across the 89-strong pertfolio, which gave the brand a 14-percent boost in earnings for year-end 2015 EBITDA.
Lone Star was also considering selling off even more hotels included in its Amaris Hospitality hotel group that includes the Hiltons Islington and Chelsea, but they have decided to hold off on those plans.
Credit Suisse and Eastdil Secured are advising Lone Star on the hotel sale.
Buyer: Pandox, Sweden-based hotel investor. Leonardo Hotels (Fattal Hotels Group) came in as operating partner, with a loan of £120m, and will get the management contract to run the hotels.
Anders Nissen, CEO, Pandox told Hotel Analyst that he retained faith in the UK despite the decision to leave the EU. He said: “Many people think that Brexit will be a disaster, which I don’t believe – the country is too strong. But if that happens the currency will go down and will have a positive effect on tourism and if things go very well then the currency rate will go up and this will be a positive result for values.
Nissen said that the company continued to look for potential acquisitions, commenting: “We are always looking to grow the company. We are looking at more in Europe – Scandinavia is too expensive at the moment.”
The group favours the lease model, with Nissen adding: “I would say that the trend is spreading across Europe. Brands don’t want to be operators and there is an increase of companies including Meininger and Steigenberger who want to take on leases – it’s one of the ways where you can make a profit if you are any good.”
In July 2017 Pandox acquired the Hilton London Heathrow Airport for £80m, with the hotel operated by Hilton under a revenue-based lease agreement.
“It’s a good market out there and we have a successful acquisition. It’s a good platform. The hotels at Heathrow all have a rate premium and the hotel already has strong efficiency. Hilton are much more interested in keeping control of the risk and it’s a strong location, with a strong local management.”
Price per Key: £170,430
THPT Comment: There was much interest in this well-run group, part of Amaris Hospitality.
Pandox are now major players in Europe, having acquired seven hotels (Germany, Austria, The Netherlands) in November 2016 – 1744 rooms for €415m from Invesco Real Estate. Pre-Jury’s, they have 122 hotels with 27,000 rooms in 11 countries.
First Seen: Hotel Management
and update: Hotel Analyst
and final details: Pandox website