Expanding Apex acquires unnamed Glasgow hotel
Apex has acquired an undisclosed hotel in Glasgow as part of an expansion strategy that includes possible expansion of its City Quay Hotel and Spa in Dundee.
The Edinburgh-based group declined to reveal the identity of the Glasgow hotel but said it will close it at the end of the year and reopen it as the Apex City of Glasgow in the new year. It has also acquired the Custom House and Harbour Chambers in Dundee and is considering plans to develop the site.
Apex is benefiting from an upturn in market conditions in London and has acquired a site in Bath where it intends to build a £35 million 177-room four star hotel.
During the year the European and City Quay hotels were sold under sale and leaseback arrangements, generating cash of £6.8m (net of transaction costs) which was applied to reduce bank debt. Under these agreements, Apex retains the rights to operate the hotels for the next 150 years, with the option to repurchase the properties at the end of the lease term at £1.
New bank facilities with Bank of Scotland were arranged after the year end, and initial borrowings of £13m were used to acquire the Bath site.
The growth plans emerged with latest figures showing turnover in the year to 30 April grew 11% from £50.5m to £56m.
Cost control enabled the group to improve margins with operating profit up 16.7% from £12.1m to £14.2m, and pre-tax profit before exceptional items 37% higher at £9.6m from £4.28m. PTP after exceptionals came in at £6.84m.
The highest paid director, thought to be Norman Springford, saw his pay leap from £245,000 to £337,000.