Travelodge snap up hotels

Jun 18 2009 by Sue Scott, Evening Gazette

BUDGET operator Travelodge, which opened a £2m hotel in Middlesbrough in December, launched a £100m property fund yesterday as it set about snapping up struggling assets in the leisure sector.

The budget chain, which is in a discount war with Whitbread owned Premier Inn, whose Marton Road hotel in Middlesbrough received a £1m upgrade this year, has launched a joint venture with Meghraj Properties.

Together they will look to acquire between eight and 14 hotels, which will then be leased to Travelodge.

It said many of the new hotels were likely to be in the struggling mid-market sector. Buying existing sites meant it could expand without the delay of planning and construction, the firm said.

Director Paul Harvey said: “Since the summer of last year we have been contacted by a substantial number of owners and administrators who have been looking to sell their hotels to us as going concerns. What stopped negotiations moving forward on many of the sites were the excessive valuations placed on the properties. Over the last two months, however, it has become clear that expectations on value have moved in our direction.”