Hotel bought out of administration
Flagship Crowne Plaza sold to ‘wealthy individual’
It has been in the hands of AlixPartners, the joint administrators of Fontenhall (Scotland), and the buyer has been found by JLL Hotels and Hospitality Group.
The 4-star Crowne is a 97-bed facility with restaurant, three meeting and event spaces, a club lounge, swimming pool, gym and landscaped gardens to the rear.
It was one of five owned by Prima Hotels Group which collapsed last May. The group bought it in 2003 and only completed a £7.25m refurbishment in 2014.
Chief executive Liam Walshe said at the time: “The major investment and alignment with Crowne Plaza signals a very bright future for the new look Royal Terrace Hotel – as well as exciting new chapter in the long history of the building.”
The seven individual townhouses which make up the hotel date back to 1860 and were designed to house a ‘circle of fashionable and wealthy people’.
The purchase is subject to a franchise agreement with the InterContinental Hotels Group. Legacy Hotels and Resorts will be retained as the interim management company as part of the transaction.
Kerr Young, director of JLL Hotels and Hospitality Group, said: “We received interest from more than 150 parties in the Crowne Plaza from a variety of buyers that were eager to purchase a hotel asset in one of the strongest performing hotel market in Europe.
“The price achieved for the hotel reflects a benchmark yield for a regional hotel asset to be sold as a going concern. We are delighted to have secured a purchaser which will look to retain both the management team and franchise with IHG.
“Barriers of entry for new hotels in Edinburgh remain high and we expected the hotel to go from strength to strength under new ownership.”
Gateleys acted for the administrators. BDO and Brodies acted for the purchaser.
>> Daily Business comment: Despite comments about the high barrier to entry, this is the latest hotel exchanging hands in Edinburgh is a tough market, a factor highlighted in the recent debate over the future of the Royal High School which is wanted for a five-star hotel.