Burges Salmon has advised Pandox, one of Europe’s biggest hotel property owners, on its £49 million acquisition of the DoubleTree by Hilton Edinburgh City Centre. The deal, which adds another key property to Pandox’s Scottish portfolio, is set to be financed by a mix of available cash and a new bank loan. The hotel will be operated by Axiom Hospitality.
Pandox’s CEO, Liia Nõu, said, “DoubleTree by Hilton Edinburgh City Centre is a great addition to our portfolio. The hotel is already performing well, but we see a lot of potential to develop the product further and increase returns. Partnering with Axiom Hospitality, which will now manage nine of our UK hotels, also reduces operational risk and ensures efficiency. This acquisition is a perfect example of how we aim to make investments that boost short-term earnings while also setting the stage for long-term growth.”
The DoubleTree hotel, which sits in the heart of Edinburgh, has 138 rooms, conference spaces, a restaurant, a bar, and an events venue with views of the castle. It was fully renovated in 2014 when it was repositioned under the DoubleTree by Hilton brand. Pandox plans to assess the hotel’s brand strategy after the current franchise agreement ends in 2027, and initial projections suggest a yield of more than 7.5%, with the possibility of rising to around 9% through further operational improvements and investments.
The deal was managed by Burges Salmon’s Hotels team, part of the firm’s Built Environment sector group, with expertise provided in corporate finance and real estate matters. Partner Robert Forman and associate Victoria MacAulay led the transaction.
Robert Forman said, “Edinburgh is a strong hotel market, and it’s great to see the hospitality sector bouncing back so well after the pandemic. Our experience in handling big hotel transactions across the UK meant we were able to guide Pandox through this exciting acquisition.”
Jacob Rasin, Senior Vice President of Transactions at Pandox, said, “We’ve developed a great working relationship with Burges Salmon. Their ability to simplify complex issues and tackle challenges quickly has been a real asset.”
The deal is expected to be completed by the end of 2024, with the sellers being affiliates of Starwood Capital.
Picture: Doubletree by Hilton
