London’s Paddington will be further regenerated with a 620-room hotel and aparthotel complex development, with the tenants already confirmed as Premier Inn and Staycity Group.
M&G has acquired the long leasehold interest of the development site and will finance the construction of the hotel complex.
Staycity, a leading aparthotel operator, will provide the aparthotel side of the development under its premium brand Wilde Aparthotels by Staycity, consisting of smart, design-led studios and one-bed spaces which will enable guests to relax, cook and work in inspiring interiors. Whitbread will provide a latest generation 373-bedroom Premier Inn hotel, which will be its first in Paddington.
The scheme also has provision for a 27,000 sq ft education facility, landscaping and open space.
Kevin Vickers, Investment Director, M&G Real Estate, says: “Business travellers continue to seek well-connected and affordable central London accommodation. The £2bn invested in Paddington in recent years has predominantly been invested in office and residential developments, positioning this hotel and aparthotel transaction as an attractive investment opportunity.
“London is one of Europe’s best performing hotel markets and is expected to account for more than a third of the pipeline of new aparthotels in the UK and Ireland market by 2021. The increase of high-profile operators entering the market and the availability of operating data is enabling investors to become more comfortable with investing into the sector.”
Whitbread, the owner of Premier Inn, and Staycity will each take 30-year leases operating independently with 60% and 40% of the
rooms respectively.
Jonathan Langdon, Acquisition Manager (Central London) for Whitbread, says: “We’ve been exploring opportunities to invest in Paddington for some time now and are very excited at the prospect of gaining a presence for Premier Inn there. It’s a fantastic development in one of London’s most vibrant and well-connected areas and the hotel adds another quality zone-one location to our growing London portfolio. The new Premier Inn will make a positive contribution to the area by offering visitors greater choice, creating local jobs and spreading the positive knock-on benefits to local businesses that Premier Inn hotels bring.”
It is expected to open by 2021 and will be constructed by Concierge 3 Limited (a joint venture partnership between The Pickstock Group, Staycity, and BSW Land & Property Ltd.).
