Property deal

Holyrood hotel sold to Zetland Capital Partners

Holyrood Hotel: new owner

Zetland Capital Partners, a London based private equity firm is acquiring the 156-bedroom Macdonald Holyrood Hotel in Edinburgh and the 338-bedroom Macdonald Manchester Hotel from Macdonald Hotels & Resorts.

The acquisition is for an undisclosed sum, but is said to be one of the largest hotels transactions completed outside of London in 2021.

The hotels will be managed by Zetland’s JV partner, Hamilton Hotel Partners.

Ahmed Hamdani, managing partner at Zetland Capital Partners, said: “Our strategy is to provide significant investment to refurbish and reposition these hotels.

“This acquisition aligns with our investment strategy to purchase and invest in well-located hotels across the UK, where we can materially enhance the product offering and benefit from the recovery of demand in the UK’s key cities.”

Aaron Falls, chief financial officer, Macdonald Hotels & Resorts, said: “The successful sale of these well-known hotels is a major milestone in our strategic business plan, which will see a substantial reinvestment in upgrading the remainder of our 28-strong hotel portfolio and 9 resorts, together with further debt reduction.”

Rob Stapleton, head of hotel transactions at Savills, said “In spite of the uncertainty caused by COVID, the opportunity generated significant interest from the market,” he said.

Zetland Capital Partners were advised by Burges Salmon (UK Legal), KPMG (Tax and Finance), EY (Structuring), Christie & Co (Commercial), Lockton (Insurance), Chandler (Technical), Nova Ambiente (Environmental), Westfort Advisors (Debt) and Arendt (Luxembourg Legal).

Macdonald Hotels & Resorts were advised by Savills, CMS Cameron McKenna Nabarro Olswang (Legal) and Alvarez & Marsal (Tax).

Starwood European Finance Partners financed the acquisition and was advised by White & Case.

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