BREAKING NEWS!

Travelodge and Meghraj have just announced the launch of a £100 million fund, Tamesis, to acquire going concern hotels from existing operators, banks and administrators.  This new fund will place Travelodge in pole position to acquire the freehold in suitable properties where this option is the preferred method of asset disposal.

To find out more about Tamesis please click on the link here or alternatively please email john.hardy@tamesiscapital.com with opportunities for consideration. 

A key part of Travelodge’s new openings programme is delivered by acquiring existing hotels that fit the company’s locational and branding criteria and the business has successfully completed a number of important transactions in this way over the last few years, to compliment our new build developments.  Over the last two years in excess of 1400 rooms have been added to the Travelodge network in this way in locations as diverse as Tunbridge Wells, Edinburgh, Eastbourne, Reading, Bath, Coventry, London Aldgate and Brighton to name but a few...

Going Concerns have the attraction of being delivered to the business without the unpredictable lead time of the planning and construction process. Although this has a number of obvious advantages, it also presents the Company with the considerable logistical challenge of integrating a trading hotel into the systems we operate without interrupting the operation of the hotel. “We never close” is probably an apt description for this process and it requires the close co-operation of all of the various departments within the business to be successful.

Our going concern transactions are dealt with under our standard leasehold model, with an occupational rack-rented lease being granted to Travelodge using our institutionally acceptable form. The deal will invariably involve a transfer of the various business assets held by the outgoing hotelier, with all room bookings, FF & E and human resources being transferred to Travelodge.  A variation on this scheme is required where the works required to the hotel are of a scale that they can only be achieved safely in a closed hotel environment and these often involve older structures or challenging Listed Buildings needing careful project monitoring and attention to detail to deliver the completed hotel to Travelodge guests.  Travelodge often project manage these processes and the construction work on behalf of the hotel owner or fund.

For example, we have secured an enviable hat trick of negotiating Listed Building Consents in Edinburgh successfully unlocking in excess of 300 bedrooms from three separate projects involving the sensitive retention of historic features alongside the practicable conversion of public areas and meeting rooms to maximise the bedstock in all three hotels.  These procedures have been handled by Travelodge's professional team from start to finish to ensure a smooth passage and in full consultation with our respective Landlords.

The Company's 'Save our Seaside' campaign will also be bolstered by the recent re-opening of the former Berkeley Hotel as the 90 bed Travelodge Worthing Seafront where a multi million pound refurbishment has been completed and Spring 2009 sees the completion of our largest refurbishment to date in terms of spend when the former Hotel St Nicholas in Scarborough re-opens as a 140 bed Travelodge overlooking the famous sands.  To help understand the Going Concern process at Worthing, please view this dvd.

The majority of these deals are structured around the Landlord funding the required works to the building to maximise the rental potential of the asset, which will either underpin the Landlord's investment with Travelodge as the tenant or aid the Landlord's onward sale of the investment that has been created with Travelodge in situ.

John Hardy and Whitestone Land are the specialist consultants to the Company who have been tasked with securing these projects throughout the UK by drawing together the various key consultants and personnel to deliver this aspect of the openings programme. All opportunities to the South of Birmingham should be directed to John and all potential projects from Birmingham northwards should be forwarded to Jeff and Nick at Whitestone Land.   Christie & Co continue to assist us in the drive for more openings outside of London and the downloadable brochure provides more detail of Christie & Co’s role, with their Sam Spencer being the main contact.

Finally, the simple matrix below should be taken as a guide of Travelodge’s positioning on five key areas that we assess immediately in considering a potential Going Concern for conversion to a Travelodge. Whilst we encourage anyone with a potential opportunity to get in touch, this may help you in acquiring a basic understanding of what we are looking for...