CDL acquires Holiday Inn London hotel for S$480.2M amid capital recycling push

SINGAPORE: City Developments Limited (CDL) has acquired the 706-room Holiday Inn London in Kensington High Street for £280 million (S$480.2 million) through its wholly owned subsidiary, Copthorne Hotel Holdings Limited, amid its ongoing capital recycling push.

The acquisition followed last week’s sale of its Bespoke Hotel Osaka Shinsaibashi in Japan to Blackstone funds for JP¥14 billion (S$117 million), marking CDL’s fourth divestment this year after its stake in South Beach development, Piccadilly Galleria, and a 250-unit multifamily asset in Sunnyvale, California.

The rare 6,356 sq m freehold site is located in central London, just a two-minute walk from Kensington High Street and close to Holland Park, Hyde Park, Kensington Palace and the Royal Albert Hall. It is also just a 15-minute walk away from the £1.3 billion redevelopment, Olympia London.

CDL said the deal worked out to roughly £396,600 per room.

The property recorded an occupancy rate of more than 97% in the nine months to September, while total revenue in the past 12 months exceeded £39 million. CDL expects a running yield of more than 6% from the asset.

In its press release on Tuesday (Dec 2), CDL executive chairman Kwek Leng Beng described the acquisition as a “once-in-a-lifetime chance” to secure an ultra-prime freehold site in Central London, as freehold sites in this area are exceptionally rare.

“It is even rarer to find one directly adjacent to our Copthorne Tara hotel,” he added.

With this acquisition, the group now owns two of the largest freehold sites in London’s affluent Royal Borough of Kensington and Chelsea, bringing its central London hotel portfolio to over 3,000 rooms. /TISG

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