Cairn Hotel Group to open the Newcastle Airport Hotel
6 July 2011 14:54:53 GMT
The Newcastle Airport hotel, which has been in administrative receivership since January 2009, is finally set to open in the next few months after a deal was concluded with the Cairn Hotel Group (CHG).
Newcastle-based CHG already owns and operates 18 hotels in the UK, primarily in London, the north of England and Scotland. The company will complete the final fit-out of the Newcastle Airport hotel after assuming ownership of the 99-year leasehold interest.
This will be CHG’s fifth hotel in Newcastle, making it the city's largest hotel owner and operator. Although most of its hotels are independently named the group operates two Holiday Inns, with another two in the pipeline.
CHG plans to operate the four-star Newcastle Airport hotel under franchise from a major international hotel brand. The group has been in detailed discussions with potential franchisors and will announce details of the franchise deal soon.
As well as 179 bedrooms and 11 conference rooms, the hotel has extensive food and beverage facilities. According to administrative receiver Peter Saville of corporate advisory and restructuring specialists Zolfo Cooper, the unusually large size of the food and beverage operations at the hotel was a key reason why a deal was concluded with CHG. "We ideally wanted to secure a hands-on operator with experience successfully running not just hotels, but also independent bars and restaurants in the local market," he said.
As well as its four hotels in Newcastle, CHG operates several independent food and beverage operations in the city’s fashionable Jesmond district, including Bar Berlise, Spy Bar and Fratello’s Bar & Restaurant, a concept that could be rolled out in the Newcastle Airport hotel.
The administrative receivers were represented in the deal by hotel investment banking specialist HVS Hodges Ward Elliott whose director Chris Martin said the innovative structuring of the finance provided by Europe Arab Bank was the key to securing an acceptable arrangement for all parties in a difficult market. “By providing CHG with the support they need in the first few years to establish the new hotel in a challenging trading market, a deal was secured at a level which reflects the future potential of the hotel,” he said.
CHG director Aran Handa said: “As a family business based in Newcastle we have watched this very well located hotel coming out of the ground for the last few years. We are now absolutely delighted to acquire it, and look forward to finishing it off and finally getting it open to the public.”