Hermes writes £120m loan for London hotel

The seven-year debt package, with a LTV of 60%, will refinance the Ham Yard hotel.

Hermes Investment Management has provided a £120 million (€136 million) loan to UK boutique hotel operator Firmdale Holdings.

The seven-year loan, understood to be in the 60 percent loan-to-value region, will refinance existing debt secured by the Ham Yard Hotel in the Soho district of London. The loan will also support the sponsor’s business expansion, Hermes said.

The debt package was brokered by JLL’s debt advisory team, led by Chris Holmes. JLL also arranged financing for Firmdale’s New York hotels in October.

This is the second hotel financing completed by Hermes Real Estate Debt Strategy since its inception in February 2015. It brings the total amount Hermes has invested in the UK real estate senior debt market to £485 million across 15 loans.

“Providing funding to help support Firmdale’s expansion following the success of Ham Yard Hotel, appeals to our investment strategy of delivering holistic returns,” said Vincent Nobel, head of real estate debt at Hermes.

“The hotel is a great destination created out of a previously disused part of central London. Firmdale’s track record as a best-in-class manager of boutique hotels gives us great confidence in its ability to manage this asset, while continuing to grow the group,” Nobel added.