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Travelodge joins leaseback cash chase
Budget hotel chain Travelodge has instructed CB Richard Ellis (CBRE) to market 136 of its hotels in order to raise at least £400m from sale-and-leaseback deals.
The chain, which has more than 240 sites in its low-cost hotel portfolio, said that each property would be secured either on a 25-year or 35-year lease.
Grant Hearn, CEO, said: “We have decided to raise cash in this way as a result of the very keen prices we have received on recent individual asset sales.
“The sale will allow us to reduce our cost of funding by paying down a large proportion of our existing debt, while still leaving us with the flexibility to take advantage of other attractive investment opportunities.”
The announcement came in the same week as Intercontinental Hotels Group (IHG) placed hotels on the market with a net book value of £500m.
According to estimates by CBRE, the current strength of demand for property could attract around £8bn of new investment into the sector.
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