Travelodge has announced it has exchanged contracts on 22 new hotels across the UK at a combined investment value of £165 million.

Low-cost Travelodge has also signed up to a new partnership with Arcadia Group, the UK’s largest privately owned clothing retailer.

Under this new scheme, Arcadia will forward fund the construction of a 96-room Travelodge hotel, above its Topshop store; in Edinburgh’s retail heartland - Princes Street.

The famous grade II listed building which houses Edinburgh’s largest Topshop store and the forthcoming new Travelodge hotel was Scotland’s very first steel frame building.

The development is scheduled to open in summer 2012 and Travelodge has agreed a 35 year lease with Arcadia, which represents a £10 million investment.

This new addition will increase Travelodge’s room stock to 1,230 rooms and 13 hotels in the Scottish capital - maintaining its title of Edinburgh’s largest hotelier.

Guy Parsons, Travelodge chief executive, said: “The strength of Travelodge’s growth model has clearly been demonstrated, with the first six months of 2011 being the strongest in the Company’s history.

“We are not just exchanging contracts but most importantly finance is being secured upfront, to enable our developers to start on-site immediately.

“Everybody knows how difficult it is to obtain bank funding at the moment, so to have financed so many new schemes must be one of the biggest success stories of the UK property industry.”

Over the last five years Travelodge has heavily focused on city centre growth to rebalance its portfolio away from roadside locations.

Today 18 per cent of Travelodge rooms are in London, 62 per cent of rooms are in major cities and towns with the remaining 20 per cent of rooms located at major motorways and roadside locations.