RPMI Railpen the investment manager for the £30bn railways pension scheme, has acquired the *commercial ground rent secured against a hotel next to Gatwick Airport.
The former 185-room property is let on a 150-year lease to Axcel Hospitality Group.
Formerly a Travelodge, Axcel Hospitality is to implement a comprehensive high-quality refurbishment of the hotel, including upgrading rooms and a full renovation of the reception, restaurant and bar areas. Heads of Terms to open as a Hyatt Place have been signed and estimated completion is Q3 2021.
Julian Allport, of Railpen’s Long Term Income Fund, commented: “Our priority is ensuring we continue to provide secure, consistent, inflation-linked income for our members. The hotel is well located for long-term growth, managed by an experienced operator and benefits from a franchise agreement with one of the world’s leading brands. The completion of this transaction highlights that Railpen is very much open for business to invest in the right opportunities.”
Railpen and Axcel Hospitality Group dealt direct, with legal counsel provided by Winckworth Sherwood and Harold Benjamin, respectively.
*Commercial ground rents are long-dated (generally over 75 years) rents paid by a corporate tenant to a freeholder for the use of a property asset. All costs associated with the property and its day-to-day management are typically the responsibility of the leaseholder. Rent reviews are usually tied to inflation, providing inflation protection to both income and underlying freehold capital value.
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acquires Gatwick Airport Hotel – acquires Gatwick Airport Hotel