Hotels purchase backed by £330m loan

The Monarch suite at the Hilton Birmingham Metropole

A £330m loan has been secured to support the purchase of the country’s largest hotel outside of London, the 790-bedroom Hilton Birmingham Metropole.

Property investor Henderson Park has bought the Birmingham hotel and its sister property, the Hilton London Metropole, in a £500m deal which has now completed. The seller, Tonstate Group, bought the hotels in 2006 for £417m.

German bank Aareal has provided the financing to back London-based Henderson Park’s debut acquisition in the UK hotel market, which adds the sites to large hotels it owns in Paris and Athens.

Henderson Park has confirmed Hilton will remain engaged as operator while it “looks at new ways to further enhance their value over the medium/long-term”.

Nick Weber, founding partner of Henderson Park, said: “The £330m financing that we have secured with Aareal is a further endorsement of both the assets’ defensive characteristics and high quality, as well as our business plans for them.

“We are also pleased to bring the first Hilton properties into our portfolio and we look forward to a rewarding long-term relationship with Hilton on these and other assets.”

The Hilton Birmingham Metropole, which is at the National Exhibition Centre, is the UK’s largest conference hotel by delegate capacity with 33 banquet and meeting rooms for up to 2,000 delegates.

Birmingham City Council owns the freehold of the Birmingham hotel. In June it transferred the asset to a new property investment body it has created which has the aim of generating additional capital receipts for the local authority.

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