OakNorth, the digital bank for entrepreneurs, by entrepreneurs, and real estate funding specialist, ASK Partners have provided a £19.5m co-loan to independent hotel management business, Capilon Hotels Group.
Capilon specializes in property investment, development and management of various sectors and asset classes, with “a particular focus on central London hotels.”
Since launch, the group has evolved “from initially acquiring townhouse hotels throughout key areas of London including Bloomsbury, Kensington, Paddington and Victoria, to now having operated and developed 11 hotels across London, such as The Blandford Hotel in Marylebone and The Judd Hotel in Bloomsbury.”
The group is partnered with Prima, a Singapore based global private equity real estate company.
The firm focusses on delivering “strong risk-adjusted returns across market cycles through investing into opportunities which mitigate inflation, debt pricing, and construction cost challenges, whilst also capitalizing on the upside potential created by the repricing of real estate assets and exposure to thriving sectors.”
The £19.5m co-loan from OakNorth and ASK will “be used to acquire and refurbish a nine-storey, Grade II listed, vacant hotel in Paddington, and convert it into a new 80-room boutique upper upscale hotel.”
Situated along Westbourne Terrace and bordering Hyde Park, the site “is easily accessible and very centrally located with only a short walk from Paddington station, as well as many of London’s main tourist attractions.”
Capilon, commented:
“For over 20 years now, our small but dedicated team has delivered hotels that have all the things that you need, and none of the things you don’t, in order to offer the best value for money for our customers. This new site, situated on Hyde Park’s doorstep, embodies this approach perfectly, and will be an excellent choice for those visiting the capital for business or pleasure. After being impressed with both OakNorth’s and ASK’s reputation for backing experienced and entrepreneurial hoteliers, they were our clear funders of choice and offered us an impressive level of flexibility and transparency from start to finish.”
Ben Hall, Chief Executive Officer at Prima, shares:
“The strategic acquisition of this prime property not only signifies our focus on the resilient London hotel market but also positions us in one of London’s most attractive growing sub-markets. We’re confident this institutionally structured deal, coupled with the benefits of using a Singapore VCC investment structure will provide our investors with a unique risk-adjusted opportunity to invest into the United Kingdom’s real estate market.”
Lucas Anglin, Associate Director of Debt Finance at OakNorth, added:
“As a result of Capilon Hotels’ hugely talented team, the group has built a highly impressive reputation for delivering quality hotels across London. With the capital’s hotel market set for significant investment going forward, the firm is in a perfect position to capitalise on this tailwind. We’re delighted to have been able to support such a well-renowned and established hotel firm and we look forward to watching their growth story going forward.”
Mike Ginsberg, Investment Analyst at ASK, said:
“Given Capilon’s excellent track record and the site’s central Zone 1 London location, ASK was very happy to underwrite this loan. We believe Capilon are well poised to deliver an exceptional offering to the marketplace. It was a pleasure to work with them and our partner OakNorth and I wish them all the best with the project.”