Deutsche Bank has provided a £200m loan to the owners of one the UK’s most upmarket aparthotels, Real Estate Capital can reveal.
The new facility has been used to the owners of the Grosvenor House Apartments on Park Lane in London’s West End. It is owned by Park Lane Properties, a joint venture between Kuwaiti investment firms Adeem, Investment Dar and Stehwaz Holding.
A three-year facility with an option of a one-year extension has been agreed. The £200m facility reflects a loan-to-value ratio of just under 75%. Deutsche is now understood to be looking to syndicate a mezzanine tranche of around £40m.
The 133-apartment scheme is situated behind the Grosvenor House Hotel and is operated by the Dubai-based, high end hotelier Jumeirah. It is run in the same way as a full service hotel but with the feel of a residential scheme designed for longer-term stays.
The new arrangement will see a loan repaid to Lloyds Banking Group. The development of the hotel was challenged during the midst of the global financial crisis and a £112m murabaha, a sharia-compliant loan, issued by the bank in 2008 proved insufficient to cover its cost. The scheme stalled in January 2009 due to a £58m shortfall but additional equity from the owners and a restructure of the financing agreement with Lloyds saw work recommence in September 2010 and complete in 2012.
The deal follows the news revealed by Real Estate Capital last week that Deutsche Bank has also been selected as the preferred party for the £300m refinancing of the iconic Savoy Hotel. It is currently in negotiations with owners Saudi Prince Alwaleed’s Kingdom Hotel Investments and Lloyds and their adviser Eastdil Secured as to whether it will provide a whole loan or a senior tranche of around £200m.
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