BMO REP acquires two newly completed Travelodge hotels
BMO Real Estate Partners (BMO REP) has completed the acquisition of two newly developed Travelodge hotels. The two pre-let developments are funded by BMO REP on behalf of a UK segregated mandate client for GBP20 million, reflecting a blended net initial yield of 5 per cent.
The vendor, the Hinton Group, undertook the construction of the two Travelodge hotels, which will operate on long term-term leases of 25 years. Both schemes also comprise Costa Coffee drive-thru outlets, each let on 15 year leases.
Both hotels which are strategically located to cater to a variety of commercial, leisure and transient demand drivers. One is situated between Oxford and Cheltenham, in the historical Cotswolds market town of Witney, and comprises 63 bedrooms as well as 71 parking spaces, with the Costa Coffee unit integrated into the main building. The second hotel is located in Emersons Green, a strategic and growing commercial district north of Bristol city centre, which is in close proximity to key transport interchanges. It comprises 90 bedrooms, a restaurant and 129 parking spaces, alongside a separate Costa Coffee drive-thru unit.
Matthew Howard, Director, Property Funds at BMO REP, says: “We are delighted to work with Hinton Group to acquire two newly built long let inflation-linked hotels for our client. These well located, limited service hotels also provide us with an opportunity to increase our client’s exposure to alternative assets, in a sector where we have strong conviction beyond the short-term disruption caused by the Covid-19 pandemic.”
BMO REP was advised by Gerald Eve and Cushman & Wakefield on the Witney acquisition and Savills on the Emersons Green acquisition.