Shankly Hotel Liverpool
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Signature puts Liverpool hotels on market for £51m

Charlie Schouten

Signature Living has put The Shankly and 30 James Street hotels in Liverpool on the market, with the properties attracting price tags of £35m and £16m respectively.

Lawrence Kenwright’s Signature Living has instructed Savills to attract a buyer for the hotels,  after first trailing a sale in May this year. In May, the developer said the Shankly was valued at £40m, with James Street valued at £17m.

The Shankly Hotel at 60 Victoria Street includes 59 aparthotel style bedrooms all based upon the football player and manager, Bill Shankly. The hotel also has a bar and restaurant, two event suites, two roof top terraces and an underground car park.

At the grade two-listed 30 James Street, there are 63 aparthotel rooms along with a terrace bar and restaurant, events space and spa facilities.

Signature Living announced in late April that it has bought out this project’s original investors, having funded the project by fractional sales.

The James Street and Shankly hotels opened in 2014 and 2015 respectively.

Signature Living founder, Lawrence Kenwright, said: “Signature Living has developed and operated two of Liverpool’s most successful hotels ever with The Shankly and 30 James Street. The hotels are huge tourism beacons in their own right, turning over incredible profits.

The profits from the sale of the hotels will allow us to fuel major expansion plans. This is an exciting new era for Signature Living. We’re looking forward to the future – a future that involves new developments across the UK.”

Tom Cunningham, director at Savills Manchester, added: “The Shankly and 30 James Street hotels present investors with two rare opportunities to acquire iconic, characterful hotels in the centre of Liverpool. With the city continuing to enjoy strong tourism growth, we’re expecting significant interest is these two sites.”

Kenwright’s business now has projects at various stages of the planning and development cycle. Locally, these include the Dixie Dean Hotel, an expansion of Alma De Cuba, the Cavern Walks Hotel and Kingsway House, where it plans to convert 1960s offices into apartments.

Also in the North West, Signature has plans for the 1824-built Rainhill Hall in St Helens, where it won consent in 2018 for a wedding venue and hotel. In April, reworked plans emerged for the Commercial Hotel site in Liverpool Road, Manchester, now proposed to house the 42-bedroom Quality Street Hotel. In 2017, Signature submitted plans for an apartment project at Victoria Mill, Miles Platting.

In its most recent accounts, filed in July this year and covering the year to 31 March 2018, Signature Living’s hotel business reported a turnover of £20.6m and a pre-tax profit of £674,000. It also listed tangible assets of £62m.

A year earlier, the group reported a pre-tax loss of £5.7m on a turnover of £14m.

Earlier this month, another Signature business, Signature Living Residential, was hit by a winding-up petition by one its creditors.

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I see several issues here for Lawrence.

First up, 3.27% profit before tax doesn’t represent “incredible profits.”

Second, Lawrence’s unique sales model has been crafted by his in-house team and isn’t something that the large branded operators would want to go near – their models being based on very different (also proven) sales channels. Add the fact that the hotels enjoy a unique decor suited to their respective markets and the refurbishment costs to bring them in line with brand standards for someone like IHG would be huge – particularly when set against last year’s profits.

So if the chains aren’t going to buy them, who will? It would need a classic entrepreneur cut out of Lawrence’s mould to do that but such people are thin on the ground. And that valuation multiple looks extremely toppy, to put it kindly.

One to watch, for sure, but I wish Lawrence well.

By Sceptical

The Shankly roof extension is undoubtedly atrocious, but Lawrence Kenwright is fundamentally a good guy – wish Signature well with their future ventures.

By Goodfellas

Good luck with the DD

By Mikes mate

Hopefully they can spend any sales proceeds actually putting a roof on 60 Old Hall Street after it has been open to the elements for a year and half, and finishing the scheme.

By Pete

£57m to £51m in the space of a few months?… If anyone was mulling in May, it sounds like they were lucky. What will be the asking price in a year??

I wonder what happens if no buyer comes forth at all.

By Mann

If Kenwright/Signature carries on as is, these will be available in a fire sale soon enough.
Investment relations are at an all time low, with the company’s reputation in tatters. Everything is mortgaged up to the hilt.
Serious investors are sitting tight and watching.

By CarlM

How on earth people have been living in 60 Old Hall Street for 18 months without a roof is shocking. Real blight on the commercial district. There once was an ugly duckling and then it became roadkill?

By Mikes mate

No chance of these valuations converting to cash. Robin Hood Kenwright will come up wanting as usual.

By Bobbie

Hopefully this frees up funds to save 60 Old Hall Street that has turned into our monstrous carbuncle with a few new windows and no roof. It’s fair to say I have seen more people working on our new kitchen than on this building. Sitting at the heart of our ‘business district’ it’s an embarrassment.

By Rufus Arflat

Very simple. EBITD x 7 gives you the max value. Could be maybe 10 if the brand has a premium. You just can’t beat these principles on a debt funded purchase. If it were an institutional lease then maybe 6% yield but that’s talking prime location and Travelodge or similar.
What’s the deal at Pall Mall with Leornado. That will give a market benchmark

By Anonymous

No mention of the Signature Cruises that were due to start this summer either…I assume that ship has sailed too

By Capt Pugwash