Hotel and restaurant scheme sold for £34m
ONE of the biggest hotel and restaurant schemes ever seen in Cardiff has been sold in a £34m deal – more than a year ahead of its scheduled opening.
The 20-storey hotel, bar and restaurant scheme is being built on the site of the empty Custom House and York Hotel buildings at the bottom of St Mary Street.
Institutional investor Aviva Investors, through its Lime Property Fund, has agreed to “forward-fund” the project in a move that has been seen as a huge vote of confidence in Cardiff ’s commercial property market.
Planning consent for the city centre project was secured last November.
Demolition of the former York Hotel and elements of Custom House is already under way.
Work on the new development – which will include a 17-floor, 248-room Premier Inn hotel – will start after Easter, and is forecast to open in 2019.
The scheme will also incorporate a Whitbread-branded Bar & Block restaurant at ground and mezzanine levels fronting Custom House Street and St Mary Street.
In effect, Aviva is providing the finance for developer Barola to deliver the project.
Jamie Devonald, of Barola, said: “We are delighted to have concluded a forwardfunding agreement with Aviva Investors to develop this important site and look forward to delivering a landmark building for both the Lime Property Fund and Premier Inn.
“In recent years our development activities have taken us away from Wales, so it will be especially gratifying to undertake a project in Cardiff, our home city.”
Kris McPhail, co-fund manager of the Lime Property Fund at Aviva Investors, added: “We are very pleased to be working with Barola on this opportunity. This transaction provides our institutional clients with inflation-linked cashflow from a strong tenant and a property that is well-located.
“These are exactly the type of investments we are actively targeting for the Lime Property Fund.”
Richard Talbot-Williams of BNP Paribas Real Estate acted for Barola jointly with Cushman & Wakefield, while JLL represented Aviva Investors.
Mr Talbot-Williams said: “With Premier Inn as its pre-let partner, Barola has skilfully put together a fantastic scheme on this prime derelict city-centre site using its unrivalled local knowledge.”
He added: “Cardiff desperately needs this centrally-located premium-budget hotel and I have no doubt that, following opening in late 2019, the hotel and restaurant will mature very rapidly and exceed its predevelopment forecast trading projections.”