Manchester Malmaison sold
A SALE and leaseback deal has been agreeed on Manchester’s Malmaison hotel by parent firm MWB.
The company has sold the 91,000 sq ft building, on Piccadilly, to British Overseas Bank Nominees and WGTC Nominees for £20.1m and taken out a 35-year lease on this site at an initial annual rent of £1.4m, with five-year index-linked rent reviews.
An option to extend the lease after 35 years has also been granted, subject to an open market rent review.
The 167-bed hotel was one of a package of four properties – including sites in London, Birmingham and Newcastle, to be sold in a deal that has allowed MWB to raise £86.8m.
MWB said the consideration reflected a yield it considered to be “a strong outcome” for shareholders in the current market environment.
The company said that service at the hotels would be unaffected. MWB, which was advised by Savills, will use the cash to pay down its debt pile, which stood at £272.1m at the end of 2010.
A statement from the firm said: “In light of the stated intention of the board to reduce debt levels, management has concluded these transactions will be an advantageous way for the group to significantly reduce indebtedness without compromising the operations.”
