Benson Elliot Capital Management and Algonquin have completed the joint acquisition of the Novotel Edinburgh Park, Edinburgh.

The hotel will be acquired from administrators KPMG. 
 
The acquisition, the second for Benson Elliot in the UK following the purchase of CBXII in Milton Keynes in late March, was made on behalf of Benson Elliot Real Estate Partners II.

The fund now holds a broad portfolio of investments in the UK, France, Germany, Spain, Scandinavia, and Central Europe. 

Benson Elliot Real Estate Partners III, a EUR505m equity fund closed last year, will begin investing in the second half of 2010.
 
Following six acquisitions in the past 18 months, the Novotel Edinburgh Park will become the 23rd hotel in Algonquin’s portfolio and is its first investment in the UK.
 
Novotel Edinburgh Park opened in mid-2008. The hotel comprises 170 rooms, a restaurant, meeting rooms and a leisure facility including a swimming pool. It is the only hotel situated within Edinburgh Park, one of the UK’s office business parks.  Accor will continue to manage the hotel under the Novotel brand.

The acquisition was financed by Barclays Corporate.
 
Trish Barrigan, senior partner at Benson Elliot, says: “The global recession and subsequent property market decline have created the opportunity to buy hotels at meaningful discounts to replacement cost and, we believe, at or near the bottom of the operational cycle. We’re actively looking at similar opportunities that represent good value today, but where there is also scope to add value through targeted capex spending and proactive management strategies.”
 
Jean-Philippe Chomette, chief executive of Algonquin, adds: “Novotel Edinburgh Park is a good quality hotel in a strong and resilient market. The asset will benefit from the already evident recovery of the hotel market in Scotland, and the arrival of the tramline next to it in the next few years as well as Algonquin’s track record in successfully managing hotel assets. We would be very pleased to contemplate other similar opportunities in conjunction with Benson Elliot across Europe in the future.”
 
Mayer Brown, CMS and Brodies acted for Benson Elliot and Algonquin, and Dundas & Wilson and Jones Lang LaSalle Hotels acted for KPMG.