Consensus Capital Property, the private equity-backed property fund, and Premier Inn, the hotel chain owned by FTSE 100 company Whitbread PLC, have agreed a deal to transform a well-known Edinburgh office block into a hotel.
The £17 million deal will turn the existing office space, formerly used by HM Revenue & Customs (HMRC), into a 127 bedroom hotel development with a 30 year lease.
Located on York Place, the hotel will be at the heart of Scotland’s capital city and less than 100 metres from one of the main stops on Edinburgh’s new tram network.
The deal is one of the largest in the city this year, and marks Concensus’ move into the hotel sector after building a successful presence in the social and residential property market across the UK.
Andrew Montague, Chief Executive said: “This deal and redevelopment represents a significant milestone for us as a company, and we hope it will be the first of many projects with Premier Inn.”
“The redevelopment of the building is good news for Edinburgh as a whole. Increased footfall in the area will create a stimulus for the city and boost the already strong tourist market.”
Kevin Murray, Senior Acquisitions Manager for Whitbread Hotels and Restaurants, said: “With a number of exciting new Edinburgh Premier Inn projects already in our development pipeline, we are delighted to announce a new 127-bedroom hotel in York Place. Our latest deal with Consensus Capital Property will drive investment and regeneration in the centre of Edinburgh and will help to push us closer to our target of achieving 75,000 rooms by 2018.
“Once complete, the development will create 40 new jobs in the local area, around half of which will be offered to the long term unemployed.