London-based equity firm Zetland Capital Partners has purchased both the 338-bedroom Macdonald Manchester Hotel and the 156-bedroom Macdonald Holyrood Hotel from Macdonald Hotels & Resorts.
The deal was for an undisclosed sum. Zetland’s joint venture partner Hamilton Hotel Partners will manage the hotel, which is located off London Road near Manchester Piccadilly.
Zetland, which became the majority shareholder of Wirral-based Typhoo Tea this past summer, said it plans to refurbish and reposition the two hotels.
Zetland’s managing partner, Ahmed Hamdani, said: “This acquisition aligns with our investment strategy to purchase and invest in well-located hotels across the UK, where we can materially enhance the product offering and benefit from the recovery of demand in the UK’s key cities.”
Calling Manchester and Edinburgh “two of the UK’s strongest markets”, Hamilton Hotel Partners partner Frank Croston said that the company was “looking forward to working with Zetland and the hotel teams to invest into and reposition these hotels”.
The sale of the two hotels was praised by Aaron Falls, Macdonald Hotels & Resorts’ chief financial officer.
“The successful sale of these well-known hotels is a major milestone in our strategic business plan, which will see a substantial reinvestment in upgrading the remainder of our 28-strong hotel portfolio and 9 resorts, together with further debt reduction,” Falls said.
Savills advised Macdonald Hotels & Resorts on the sale, along with legal consultant CMS Cameron McKenna Nabarro Olswang and tax adviser Alvarez & Marsal.
“We’re pleased to have advised on this significant transaction in two key UK markets,” said Savills head of hotel transactions Rob Stapleton. “In spite of the uncertainty caused by COVID, the opportunity generated significant interest from the market. It was a pleasure working alongside the management team at Macdonald Hotels & Resorts and with Zetland to conclude this deal.”
Zetland was advised by Burgess Salmon, KPMG, EY, Christie & Co, Lockton, Chandler, Nova Ambiente, Westfort Advisors and Arendt on the deal.
The acquisition was financed by Starwood European Finance Partners, which was advised by White & Case.