Following the appointment of Gerald Eve's Capital Markets and Hotel Advisory teams, Travelodge Hotels has secured development funding to deliver a new, purpose-built hotel scheme in Chiswick, located next to Chiswick Roundabout and Chiswick Flyover and situated only 400m from Chiswick Business Park.
The funding partner, RTP Global Real Estate Investments, have purchased the site and committed to fund the development site for £19.4m and simultaneously retained Travelodge Hotels Limited as the development manager for the scheme, which will comprise a 113-bedroom hotel, arranged over ground and five upper floors.
The hotel will be developed to Travelodge’s latest brand specification and will be built to BREEAM ‘Excellent’ rating, with 31% of the bedrooms being ‘SuperRooms’. Upon practical completion, anticipated for Q4 2023, the hotel will be single-let to Travelodge Hotels Limited on a new 35-year lease, with 5-yearly, index-linked rent reviews. The purchase price reflects a funding yield of 4.75%.
Travelodge currently operates 598 hotels across the UK, Ireland and Spain, and 79 hotels in London. The Group is one of the largest budget hotel chains in the Capital, with hotels operating in 31 out of 33 London boroughs.
We are delighted to secure a funding partner for this prime opportunity, which combines exceptional location fundamentals and the security of a long, 35-year lease with indexation, to one of the sector’s leading operators.
Richard Lines, Head of Alternative Capital Markets at Gerald Eve
The budget hotel sector has been one of the most resilient markets in the UK since the outbreak of COVID-19 as a result of the lower price point and primarily domestic customer base. This is epitomized in Travelodge’s most recent trading results (Q2 2022) with Revenue, RevPAR and EBITDA all materially ahead of the same period in 2019 (pre COVID-19).
Will Kirkpatrick, Head of Hotels at Gerald Eve
Chiswick has a significant undersupply of branded hotel accommodation, and we are delighted to be developing a new Travelodge in an excellent location here. This site is brilliantly located for the North and South Circulars, the A4, Gunnersbury Station (for Overground and District Line services), Chiswick Business Park and the shops, bars and restaurants on Chiswick High Road , so will be a great place for business and leisure customers to stay. Smith Jenkins did a great job of securing planning permission for the new hotel and we then decided to act as the developer for the scheme. After appointing Gerald Eve to find us a funding partner, we are delighted to have now exchanged our Development Funding Agreement with RTP Global Real Estate Investments, which will forward fund the development, with the hotel to be built by DNA Construction, one of Travelodge’s partnering contractors.
Tony O’Brien, UK Development Director at Travelodge
RTP RE will work with Travelodge to deliver a quality asset with excellent environmental credentials that will positively contribute to the local economy and provide much needed additional supply of affordable hotel rooms in West London.
Lana Lomovtseva, Managing Partner at RTP RE