Singapore-based hospitality trust CDL Hospitality Trusts is making its first foray into Europe with the planned acquisition of Cambridge City Hotel.
The acquisition will be carried out by CDL HBT Cambridge City (UK), a unit of CDL Hospitality Trust and the sale price is worth about GBP62.5 million (USD96.42 million).
The refurbished hotel features 198 rooms and is located 1.6 kilometers from the Cambridge railway station.
Last April, the hotel completed a GBP8.2 million refurbishment that refreshed the public areas and all the hotel’s rooms.
CLD HBT will acquire 100 percent of the issued capital of LR (Cambridge). After the acquisition, LR (Cambridge) will be renamed to CDL HBT Cambridge City Hotel (UK).
LR (Cambridge) will continue to hold and operate the hotel under its new name.
“This acquisition in Cambridge is in line with our strategy to invest in markets with good growth potential,” said Vincent Yeo, chief executive of the trusts’ managers.
Yeo added that Cambridge has been one the strongest-performing hospitality markets in Britain and the burgeoning life science cluster in the area is expected to support the growth trajectory of the market.
“The acquisition is a rare opportunity… to acquire a prime asset in a tightly held investment market,” he added.
In a statement, CDL said the acquisition will be fully financed initially by pound-denominated debt. Once the deal is completed, the trusts’ gearing will increase from 32 percent to 35.8 percent.
The acquisition in Cambridge marks CDL HT’s first investment in Europe and represents a diversification of its portfolio from the Asia-Pacific region.
The hospitality outlook for UK continues to be strong with international tourist arrivals expected to hit a record 35.1 million in 2015.
The recent streamlining of visa process for Chinese visitors entering UK is also likely to encourage more inbound travel from the world’s largest tourism source market. – HotelNewsAsia.com