Indian-origin hotelier secures £230 mn funding for luxury UK hotel
The transaction was agreed during the Covid-19 pandemic lockdown and has been branded a “vote of confidence” in one of the largest recent development facilities for a central London hotel.
The Shiva Hotels Group, headed by Indian-origin hotelier Rishi Sachdev, on Monday confirmed clinching a 230-million pound development financing package to fund the construction, through to completion, of its new 199-room luxury lifestyle hotel in Marylebone, central London.
The transaction, involving real estate investment and finance firm Cale Street Investments and UK-focused real estate investment firm Crosstree Real Estate Partners, was agreed during the Covid-19 pandemic lockdown and has been branded a “vote of confidence” in one of the largest recent development facilities for a central London hotel.
“This is a major milestone for our Marylebone Lane development, and brings the delivery of what we believe will be one of London’s most iconic hotels one step closer,” said Sachdev, Managing Director of Shiva Hotels.
“This is a challenging time for everyone involved in the hospitality sector and our near-term focus continues to be on working closely with all our stakeholders to navigate through this period of uncertainty. “Longer-term however, we are steadfast in our conviction that the global appeal of London will continue and that this will translate into strong demand for our carefully curated hotels in highly desirable locations,” he said.
Cale Street is providing 160 million pound and Crosstree 70 million pound of the initial four-year facility, which has an option to extend and refinances a 80-million pound loan that was in place with ICG Longbow.
“Cale Street and Crosstree are both hugely experienced and highly selective real estate financiers and bring a deep understanding of the UK hospitality sector. Securing this package, particularly in the current economic climate, is a further endorsement of our vision to create an unrivalled luxury lifestyle hotel brand and we are extremely excited to be partnering with both parties,” added Sachdev.
Peter Robinson, a Partner at Crosstree, said: “Given the current dislocation in real estate financing markets for projects of this type, Crosstree together with Cale Street are pleased to be working with Shiva in taking forward this prime hotel development. “While no doubt we are currently in a challenging period for the hospitality industry, we share a longer term vision of the resilience of London and high quality real estate and locations such as this.”
The Marylebone Lane Hotel, which is due to welcome its first guests in early 2023, is one of a range of luxury lifestyle hotels planned by UK-focused hotel owner and manager Shiva Hotels, which includes two further central London development sites – at Holborn Viaduct and on Poland Street.
The hotel company, founded in 2002, said a key driver in the strategic acquisition of the Marylebone Lane site, previously a car park, was both its adjacency to the new Bond Street Crossrail station, as well as its location at a high-profile corner in the area.
Since acquiring the site, Shiva Hotels said it has worked closely with Westminster City Council and local interested parties to secure a planning consent for an “exceptional” building, featuring multiple destination restaurants, a roof-top swimming pool and a subterranean event space. Construction specialists John F Hunt have been appointed to undertake demolition site ground works as well as the initial substructure and frame construction works, with the main contractor to be appointed early next year.