While ultra-luxury grabs everyone’s attention, institutional money is buying Novotel and ibis hotels. Starboard Hotels and LaSalle Investment Management have just acquired seven 913-room Accor-branded hotels in the UK from Ares Real Estate and EQ Group. The deal will increase Starboard’s UK portfolio to 28 hotels and more than 3,000 rooms and will be the operator’s first joint venture with private equity. Here’s a breakdown of the assets and what the deal says about the UK regional hotel market. Briefly 🤝 Buyers · Starboard Hotels, a UK operator, and LaSalle Investment Management, a global asset manager, in a joint venture 💼 Sellers · Ares Real Estate Funds and EQ Group, thereby clearing a UK portfolio of 18 assets acquired together in 2024. 🏨 Portfolio · 7 hotels, 913 rooms under the Novotel and ibis brands, managed by Starboard under the Accor franchise 📍 Cities · Birmingham (2 hotels), Sheffield, Southampton (2 hotels), Luton and London Barking 📈 Impact · Starboard operates 28 hotels and over 3,000 rooms in the UK, including 15 under Accor brands; price not disclosed Novotel Birmingham Center on Broad Street, one of seven hotels included in the deal. Photo by Jan S., CC BY-SA 2.0 Seven hotels acquired The portfolio focuses on train stations, airports and city centres, meaning year-round demand that is largely independent of the tourist season. It includes two hotels in Birmingham: the ibis Birmingham New Street, located in the Arcadian Center in Chinatown, and the Novotel Birmingham Center on Broad Street in Brindleyplace. The Novotel Sheffield Center is a five minute walk from the station and the ibis Luton Airport is ten minutes from the terminal. There are two locations in Southampton: the ibis Southampton Center near Central Station and the Novotel Southampton near the cruise terminals.while ibis London Barking offers views of London and direct access to Canary Wharf. Advertising Southampton Cruise Terminal is the engine of demand for local hotels. Photo by Terry Robinson, CC BY-SA 2.0 Luton Airport terminal, next to the ibis hotel. Photo by Stacy Harris, CC BY-SA 2.0 Starboard’s first joint venture The deal is a first for the UK operator, which has never previously entered into a joint venture with a private equity fund. “This is our first private equity joint venture transaction and we are delighted to be partnering,” said Fraser Callingham, managing director of Starboard Hotels, who expects the deal to deliver efficiencies across its portfolio. As for investors, Leif Skogland, vice president of value-added investments in Europe at LaSalle, said he sees “great potential in this portfolio.” Starboard will assume management of seven hotels under Accor’s existing franchise agreements, effective immediately.leaving brands and distribution systems unchanged for guests. For sellers, end of 27 month cycle On the supplier side, the transaction completes a broader operation. Ares Real Estate and EQ Group jointly acquired a UK portfolio of 18 assets in 2024; these seven hotels made up the remaining amount. Hussain Sunderjee, managing director and partner at EQ Group, described a 27-month cycle that achieved significant value creation through fast execution and strong operational management. Twenty-seven months between the acquisition of a portfolio and its full resale is a short period for hotel real estate.speaks volumes about the restored liquidity of the UK market. JLL and Christie & Co advised on the transaction. See also What the deal reveals about the UK market Two main conclusions follow from this. Firstly, institutional investor appetite is no longer limited to London: Birmingham, Sheffield and Southampton offer higher returns than the capital, and corporate and transit demand is less volatile than commonly thought. Second, the franchised mid-market remains the true engine of transactional activity. A room at a Novotel or ibis hotel sells for less than a luxury palace room, but it is occupied all year round, has low running costs and generates predictable cash flow, which is exactly what funds are looking for. Find UK hotel news at La Revue des Hôtels. Our point of view The deal illustrates the division of roles that has become the standard in European hospitality. The owner provides capital, the operator brings local expertise, and the brand remains that of a large group through franchising. Accor did not buy or sell anything here, but retains the seven addresses in its network and the associated distribution revenues. This is a model in which the hotel group no longer owns the property and assumes little risk, and relies on specialized operators such as Starboard to perform.. For the traveler, nothing will change in the short term; the real issue will be the refurbishment investment the new joint venture will make into those 913 rooms. Buyers Starboard Hotels and LaSalle Investment Management in joint venture Sellers Ares and EQ Group real estate funds Briefcase 7 hotels, 913 rooms Brands Novotel and ibis franchised by Accor Resources ibis Birmingham New Street, Novotel Birmingham Centre, Novotel Sheffield Centre, ibis Luton Airport, ibis Southampton Centre, Novotel Southampton, ibis London Barking Price Undisclosed Advisors JLL and Christie & Co. Operations Starboard, in accordance with existing Accor franchise agreements. Strike to starboard 28 hotels and over 3,000 rooms in the UK, including 15 under Accor brands Origin of assets The remaining balance of the 18-asset UK portfolio acquired by Ares and EQ Group in 2024. Practical information Starboard Hotels · British hotel operator, 28 hotels in the UK LaSalle Investment Management international real estate asset manager Participating brands · Novotel and ibis, Accor group Cities Birmingham, Sheffield, Southampton, Luton and London ✦ Are you planning to spend time? Reserve your hotel de luxe au meilleur prix. Reserve → Post navigation US restricts travel and activities in Nogales – KTAR.com Brand Atelier Unveils Intelligent Platform to Help Hotels Turn Fragmented Data into Faster Decisions and Execution |