De Vere offloads hotel portfolio to US investor
A US private equity firm has swooped for a portfolio of hotels owned by one of the UK's best-known hospitality and leisure groups. The sale includes two hotels in Leeds and one in Hull.
KSL Capital Partners has purchased Village Urban Resorts from De Vere. The deal comprises 25 properties with a further three under construction.
De Vere said the disposal marked the successful completion of its "build and crystallise value" strategy. It added this process, implemented by the board and executive team, has delivered sale proceeds in excess of £1bn and "effectively saved several thousand jobs".
Hotels included in the latest sale include Village Urban Resort's Leeds South, Leeds North and Hull.
"We are delighted to have achieved this overall result following the financial restructuring in 2010 and the creation of a new board in 2011," said chief executive Andrew Coppel.
"The support of Lloyds Bank in particular from late 2011 was critical, as this enabled the team to build value within three quality businesses and realise premium prices on disposal.
"To generate over £1bn of sale proceeds in challenging market conditions reflects well on the team. It represents a vindication of our strategy and the Lloyds Bank's confidence in the company."
Coppel added Village Urban Resorts is "now in great shape" and has forward momentum with the openings in December and the new year of properties in Aberdeen, Edinburgh and Glasgow.
"Its future is positive, undoubtedly enhanced by KSL's commitment to invest substantially in the existing portfolio and pipeline," he said.
In March, De Vere sold its venues division to Starwood Capital, with the £232m raised going towards bank debt. It has also offloaded other assets, with the £50m disposal of the Grand in Brighton in April perhaps the most high-profile.
For the 12 months to 31 December 2013, the group generated £359.8m of sales and operating profits of £33.3m. After taking fixed asset impairments and discontinued operations into account, it made an operating loss of £48m.