TIDMEZH
RNS Number : 6553M
easyHotel PLC
01 August 2017
1 August 2017
easyHotel plc
easyHotel plc
("easyHotel", the "Group" or the "Company")
Update on Old Street Hotel, London
The Board of easyHotel plc, the owner, developer and operator of
"super budget" hotels, today announces the conclusion of a
comprehensive review of options, including the sale or partial sale
of the building, for its Old Street hotel which it announced on 30
March 2017.
Following a pre-application meeting with Islington Borough
Council on 8 June 2017 to discuss a potential extension to the
upper floors of the building (3(rd) - 5(th) floors, the hotel is on
the lower floors) the Council has indicated that it has no
objections in principle, subject to conditions, to an extension to
the building for offices. The Board, having taken specialist
advice, believes that restoring and extending office use on the
upper floors should maximise value from the property. The Group
will, therefore, be retaining a smaller 92-bedroom hotel and
applying for planning permission to add additional floors to the
building, for use as office accommodation. The Group will close the
third and fourth floors of the hotel, removing those rooms from
inventory from 3 October 2017.
The Group further intends to refurbish the 92-bedroom hotel, to
complement the 'new look' format hotels it has recently opened in
Birmingham and Manchester. This is anticipated to improve Revpar in
the hotel, and combined with the additional office space, is
expected to drive shareholder value from the site. The
refurbishment of the hotel is likely to result in a short term
adverse impact to earnings as the works are carried out.
The existing (larger 162-bedroom) Old Street hotel made an
EBITDA contribution of approximately GBP1.7m (before the allocation
of central overheads) in the Group's last financial year ended 30
September 2016.
Commenting, Guy Parsons, Chief Executive of easyHotel plc
said:
"After undertaking extensive due diligence and considering all
the options available to it, the Board considers the retention of
the 92-bedroom hotel, together with an extension to the upper
floors for additional office accommodation, to be the best outcome
for shareholders.
"We have been delighted with the performance of our newly opened
hotels in Birmingham and Manchester, which are trading strongly,
and the refurbishment of Old Street will enable us to improve
Revpar in the hotel. The Group will submit a full planning
application for an extension to the building in due course."
Enquiries:
easyHotel plc
Guy Parsons, Chief Executive www.easyhotel.com
Officer
Marc Vieilledent, Chief http://ir.easyhotel.com
Financial Officer
Investec (Nominated Adviser
and Broker) +44 (0) 20 7597 5970
David Anderson
Houston PR (Financial
PR) +44 (0) 20 3701 7660
Kate Hoare
Notes to Editors:
www.easyhotel.com http://ir.easyhotel.com
easyHotel is the owner, developer, operator and franchisor of
branded hotels. Its strategy is to target the "super budget"
segment of the hotel industry by marketing "clean, comfortable and
safe" hotel rooms to its customers.
Operating hotels
easyHotel's five owned hotels currently comprise 590 rooms, and
it has a further 20 franchised hotels with 1,750 rooms.
Owned hotels:
Old Street (London), Glasgow, Croydon, Birmingham,
Manchester.
Franchise locations:
Belgium (Brussels), Bulgaria (Sofia), Germany (Berlin,
Frankfurt), Hungary (Budapest), The Netherlands (Amsterdam: City,
Arena & Zaandam, Rotterdam, The Hague), Switzerland (Basel,
Zurich), UAE (Dubai), United Kingdom (Edinburgh, London Heathrow,
Central London, Luton).
Hotel development pipeline
The Company's committed development pipeline of owned and
franchised hotels currently consists of:
Owned hotels:
United Kingdom (Liverpool, Ipswich, Sheffield, Leeds), Spain
(Barcelona) Subject to planning consent: United Kingdom (Oxford -
lease).
Franchise hotels:
UAE (Dubai), Germany (Bernkastel-Kues), Portugal (Lisbon),
Turkey (Istanbul), Nepal (Kathmandu), UK (Belfast, Reading), Iran,
Sri Lanka.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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