Valorem Investment Partners has secured funding for the 260-bedroom Dalata Maldron Hotel on the corner of Park Lane and Liver Street.
The £37.5m transaction is the first regional forward funding agreement since the pandemic started in March 2020, according to Dalata, and “reflects strong and growing confidence in UK regional hotels”.
The hotel is pre-let to Irish operator Dalata on a 35-year lease with inflation linked rent uplifts throughout the term. The hotel will trade under the company’s four-star lifestyle brand, Maldron.
McAleer & Rushe has been appointed as the main contractor for the Liverpool project, which is due to begin early next year. The hotel is scheduled to open in mid-2023.
Developer Elliot Group used to part-own the site but Valorem took full control of it last year. The hotel will sit alongside the Heap’s Rice Mill site, earmarked for redevelopment into around 400 apartments by Valorem.
Aviva is funding the hotel project through its Linked Property Fund and was advised by Kimmre.
Valorem Investment Partners was advised by BNP Paribas Real Estate.
“This will be one of the best and most successful hotels in in a fantastic city centre location in one of the UK’s strongest regional hotel markets,” said Richard Talbot-Williams, senior director of alternative markets at BNP Paribas Real Estate.
“This new partnership between Valorem, Aviva, Dalata & McAleer & Rushe demonstrates that the UK hotel development market is open for business and bouncing back from an understandable Covid pandemic new development pause.”
Martin Claisse, head of development at Valorem, said: “We are delighted to be working with partners of the calibre of Aviva and McAleer & Rushe to deliver what will be the most significant addition to the hotel offer in Liverpool in recent years. To be bringing this site forward so shortly after such a difficult period with Covid is a testament to our team.”
John Osborn, fund manager at Aviva Investors, said: “The attractiveness of this investment for the fund is underpinned by the strength of the city centre location and the long-indexed income stream.”
In 2018, Aviva agreed to forward fund a 329-bedroom Clayton Hotel in Manchester, developed by Property Alliance Group. The Clayton chain is part of the Dalata Group.