Corinthia Hotels has announced plans for a flagship London luxury hotel and residences project.

Following its acquisition last year from The Crown Estate of the iconic Metropole building on Northumberland Avenue and the adjoining 10 Whitehall Place, the hotel chain has since secured funding and commenced works for the refurbishment of both buildings, transforming then into a luxury hotel and private residences.Construction on site is proceeding apace and, last week, bank funding was secured by way of a £135 million loan. The loan matches the £135 million invested as equity by the developers, setting a 50:50 loan to equity gearing on the project.

The Metropole Building and 10 Whitehall Place were acquired from The Crown Estate last year by a consortium owned equally by International Hotel Investments plc of Malta (IHI) and two of its principal shareholders, the Libyan Foreign Investment Company and Nakheel Hotels of Dubai.

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The prOperty will also include a lapge central courtyard foyer, two clusters of restaurants, a destination bar, a ballroom restored to its original splendour and meeting facilities. The adjoining 10 Whitehall Place property will be redeveloped to include a 2,500m2 luxury spa operated by ESPA, as well as a suite of 12 exclusive residences ranging from 250m2 up to over 1000m2. The project is targeted for completion by the end of 2010.

Since its inception, IHI has built up a valuable £1 billion portfolio of owned hotels, as well as retail space and offices in various countries, including landmark properties which the Company has acquired and developed in St Petersburg, Prague, Budapest, Tripoli, Malta and Lisbon. The Corinthia Hotel & Residences in London is the company’s first UK venture.

Mr Alfred Pisani, Chairman of IHI, founded Corinthia Hotels in 1962, when he established one of Malta’s first five-star hotels. Despite the company’s expansion in the intervening years, Corinthia Hotels has remained a family organisation.

Discussing the move into the UK marketplace, Mr Pisani commented: “Entering the UK market has been a target for us for many years. We believe that this redevelopment project - at this time - and in what will be one of London’s iconic hotels - will reap tangible immediate and long-term rewards not only by virtue of the investment itself, but also in widening the appeal of our Corinthia Hotels brand into this world capital.

The London project will also provide us with an excellent platform to continue to pursue our aggressive expansion strategy, with further acquisitions and developments currently being considered.”

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