Investment firm KSL Capital Partners has agreed a deal with hotel group De Vere for its Village Urban Resorts hotel brand.
The deal includes a total of 28 branded Village hotels, with locations including Coventry, Dudley, Walsall and Solihull. However, only 25 of the hotels are completed at present, with the final three under construction and expected to be completed within the next year.
Furthermore, in the New Year plans are already in place to enter the Scottish market, with hotel openings set for Edinburgh, Aberdeen and Glasgow.
Analysts speculate that this move would have been taken earlier this year, but due to the uncertainties surrounding the Scottish referendum De Vere decided to hold off as a Yes vote could have potentially lowered the value of the deal with KSL Capital Partners.
Although no official value has been confirmed for the sale of Village Urban Resorts, executives at De Vere confirmed that it has now pushed the firm’s sale proceeds to over £1 billion. The deal was part of an overall strategy designed by De Vere in 2010 to maximise profits and increase turnover by utilising its assets in the most beneficial way possible.
Chief executive Andrew Coppel believes the current performance of De Vere is a direct result of the ongoing strategy implemented in 2010.
He says; “We are delighted to have achieved this overall result following the financial restructuring in 2010 and the creation of a new board in 2011.
“The support of Lloyds Bank in particular from late 2011 was critical, as this enabled the team to build value within three quality businesses and realise premium prices on disposal.
“To generate over £1 billion of sale proceeds in challenging market conditions reflects well on the team – it represents a vindication of our strategy and the Lloyds Bank’s confidence in the company.”
Other sales in the past year have included that of De Vere’s venues division to Starwood Capital in March, during which it raised £232 million that was then used to reduce its bank debt. One month later, De Vere achieved its most high profile sale of the year with the offloading of the Grand in Brighton for £50 million.
Village Urban Resorts has become something of a jewel in the crown for De Vere, yet Mr Coppel believes that KSL Capital Partners will continue to build the brand in future.
He concluded; “Village Urban Resorts is now in great shape and has forward momentum with the openings in the New Year of properties in Aberdeen, Edinburgh and Glasgow.
“Its future is positive, undoubtedly enhanced by KSL’s commitment to invest substantially in the existing portfolio and pipeline.”
