Dalata plots four-star Manchester hotel next to Circle Square

Irish hotel operator Dalata has signed an agreement with a fund administered by Catalyst Capital to build a four-star hotel on a site next to Bruntwood and Select Property’s Circle Square.

Dalata has signed the deal with CEPF II, the fund run by Catalyst, and is planning to have the hotel open by 2021, subject to planning consent from Manchester City Council.

Although the exact site of the hotel has not been disclosed, it is understood to be off Charles Street where a large portion of land next to the railway is used as a surface car park, while there is also a smaller surface car park bordering Charles Street.

It will be operated as a four-star hotel under Dalata’s Maldron Hotel brand is will feature 276 rooms.

If it secures planning permission, it will be Dalata’s second hotel in the city centre and its third in Greater Manchester.

It already operates a Clayton Hotel at Manchester Airport, and is set to run a 17-storey, 329-bed hotel at 55 Portland Street, which is being brought forward by Property Alliance Group with funding from Aviva Investors. The latter will also be operated under the Clayton brand.

Circle Square, the mixed-use development on the former BBC site off Oxford Road, is due to complete in 2020. It also features a 155-room hotel, which is set to be built by main contractor Russells.

Work is well under way across the mixed-use Circle Square site

The site is currently a hive of activity with Bowmer & Kirkland well under way with an 18-storey student accommodation block, while John Sisk & Son is delivering a £247m Affinity Living development across two buildings. The latter contractor is also working on two office buildings totalling 400,000 sq ft.

Wates has also recently completed the site’s Vita Student development towards the Princes Street side of the site.

In its half-year results, Dalata reported a 10.6% increase in revenue year-on-year to €180.6m [£162.8m], while profit before tax rose by 8.3% to €35.4m [£31.9m].

Catalyst Capital is also backing another hotel development in Manchester, the £17m New Cross StayCity, which has been designed by SimpsonHaugh and is being built by Bardsley.

The eight-storey building, which secured planning approval in January this year, will house 48 one-bed and 176 studio rooms, along with a reception, café, and gym. It is due to complete in December 2019.

Earlier this year, the investor also poached former JLL development director Tom McWilliams to head up its Manchester office.