The battle to buy London’s Grosvenor House hotel is hotting up with news that the Candy brothers, property developers to the super-rich and famous, have entered the arena.
The brothers, whose clients include Gwyneth Paltrow and Kylie Minogue, are thought to be working on a bid with an Asian financial backer.
According to The Times, they are also interested in buying a serviced apartment block next to the Grosvenor.
The brothers, whose clients include Kylie Minogue and Gwyneth Paltrow, are understood to have shown interest in buying a serviced apartment block next door to Grosvenor House. This would allow them to turn the apartments and hotel into a giant luxury residential scheme for the super-rich.
The five-star Grosvenor is owned by the government-funded Royal Bank of Scotland, which is hoping to raise £600-£700m in a bid to rebuild its balance sheet.
Property agent CBRE has been appointed to handle the sale of the Park Lane hotel.
Both domestic and overseas investors have been busy buying into London’s commercial property sector since the summer, and the market has picked up sufficiently to warrant the sale.
Grosvenor House is operated by JW Marriott and has 494 bedrooms. A price of £600m would equate to £1.2m per room. The venue is renowned for its roster of top ceremonies including the Professional Footballers’ Association Awards, the World Travel Awards and the Mercury Music Awards.
RBS has invested about £135m in the Grosvenor House, refurbishing guest bedrooms and adding 48 extra rooms.
The building was once one of the largest private houses in Mayfair and the site was the home of the Duke of Westminster and the Grosvenor family.
It was in the family’s possession until the first world war, when the government requested it for state use. After the war the Grosvenors decided it was too lavish to maintain so it was sold and turned into a hotel.
RBS took control of the Grosvenor in 2001, paying £1.25bn for 12 Le Meridien hotels as part of a sale-and-lease-back deal that was used by Nomura to finance its £1.9bn acquisition of Le Meridien from Compass.
It attempted a sale in 2007 and 2008, with a number of Middle East groups linked with a deal, including Kuwait’s Adeem and Bahrain’s ruling family.
The deal was masterminded by Guy Hands, one of Britain’s most high-profile private equity bosses and then a Nomura financier.
Le Meridien collapsed into receivership in 2003, and operation of Grosvenor House passed to Marriott.