Big news from London today, where InterContinental Hotels Group has agreed to sell its London Park Lane Hotel to Middle Eastern investors for $457 million.
According to Bloomberg, InterContinental will run the 447-bedroom hotel under a 30-year contract and can extend that another 30 years. The hotel was bought by an affiliate of Constellation Hotels Holding Ltd. for 62 percent more than book value at the end of December, according to a statement.
London’s luxury-hotel market has been defying Europe’s sovereign-debt crisis and Britain’s struggle for economic growth as overseas visitors drive record sales and occupancy rates, boosting values. The hotel generated $89 million in revenue last year and InterContinental said it expects fees of about 4 million pounds a year from the management agreement.
The London Park Lane, which overlooks Hyde Park and is about a 10-minute walk from Buckingham Palace, opened in 1975. It was once the site of a royal residence and includes a full- service spa, according to the hotel’s web site.