MWB Group, the operator of the Hotel du Vin and Malmaison hotel, has announced it has exchanged contracts on the sale and leaseback of its 80-room Malmaison hotel in Aberdeen to CIP Property (AIPT) Limited for £16.1m in cash.
The deal marks the fifth Malmaison-branded property, which the company has sold and leased back this year, for a total consideration of over £102m.
Last month it concluded a sale and leaseback deal for four of its Malmaison branded hotels in the City, Birmingham, Newcastle and Manchester, for a total consideration of £86.6m.
The Aberdeen property has a book value of £16.5m (£18.2m, including the operational fixtures, fittings and equipment which will be retained by the MWB) at 31 December 2010, The transaction is conditional on approval by MWB shareholders.
The company said that the proceeds from the transaction would be used to reduce the indebtedness of Malmaison, which as at 31 December 2010, amounted to £272.1m.
The group said it continued to be in discussions with a number of parties regarding the sale and leaseback or outright sale of a number of its hotel assets, as it looks to reduce its debt levels. It said it continued to operate within the terms of the existing facilities.
Richard Balfour-Lynn, chief executive, said: “This fifth sale and leaseback is enabling us to reduce Malmaison's debt by more than £100m which, in today's market we regard as extremely beneficial. At the same time we are achieving our goal of maintaining a high proportion of freeholds within the portfolio of approximately 80% (by number), with the remainder made up of extremely long term operating leases.
“The Malmaison and Hotel du Vin brands continue to show great resilience in the current economic climate and remain a firm favourite of our loyal customer base. We are now creating a platform to further expand our business both nationally and internationally.”
