The Singapore-based real estate investment trust (REIT), CDL Hospitality Trusts, has made its first foray into the European hospitality market with the £61.5m acquisition of a Cambridge city centre hotel.
The Far East investor bought the 24-year-old Cambridge City Hotel from LR (Cambridge) Limited, citing the UK’s rapidly growing economy and its solid employment growth as key factors behind the acquisition.
In a statement CDL said: “There are a very limited number of hotels in Cambridge, particularly commercial hotels with meeting facilities in the city centre. Hence, it is a rare opportunity to secure a prominent presence in the city through owning one of the largest hotels there.”
Completed this spring, the 198 room Cambridge City Hotel has undergone a year-long £8.2m refurbishment to its public areas and bedrooms. Additional assets included in the deal are three local food and beverage outlets, conference and event facilities and on-site parking for 50 vehicles.
Cambridge is a city renowned for its history, architecture and cultural appeal for both domestic and overseas visitors, explained the statement. But it was Britain’s tourism recovery – and its attraction to Chinese tourists – which sealed CDL’s decision to choose the UK over other European countries.
“The hospitality outlook for 2015 continues to be strong with international tourist arrivals to UK expected to hit a record 35.1m,” it said. “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. The record number of visitors, coupled with the improved economic outlook, is likely to have a positive effect on hotels across UK.”
Vincent Yeo, a chief executive at CDL, described the acquisition of the Cambridge City Hotel as a “rare opportunity for us to acquire a prime asset in a tightly held investment market”.
Adding that: “This purchase in Cambridge is in line with our strategy to invest in markets with good growth potential. Cambridge has been one of the strongest performing hospitality markets in UK and the burgeoning life science cluster will support the growth trajectory of the market.”
Through its subsidiaries, CDL Hospitality Trusts invests in hospitality and hospitality related real estate assets. Since its 2006 launch it has added the Orchard Hotel, Grand Copthorne Waterfront Hotel, M Hotel, Copthorne King’s Hotel, and Novotel Clarke Quay in Singapore to its portfolio. Other assets in its 3,942 bed chain are the deluxe Rendezvous Hotel Auckland and the Novotel in Brisbane, Mercure Brisbane, Ibis Brisbane, Mercure Perth, and Ibis Perth in Australia.
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