YT Realty Group Ltd, the Hong Kong-based investment company, has purchased the Travelodge Hotel close to Liverpool Street Station in London from Goldman Sachs – advised by CBRE - for £42m. The deal reflects a net initial yield of 4.84%.
The 142-bedroom hotel, which was acquired by Savills on behalf of the Hong Kong investment firm, is arranged over seven floors and is let to Travelodge Hotels Ltd with an unexpired term of 33 years and generates £2,069,144 a year. The investment includes an underletting to the Post Office for 20 years from 2001 at a peppercorn rent.
Phillip Garmon-Jones of the cross border investment team at Savills in Hong Kong commented: “We are delighted to have assisted YT Realty in its first independent UK acquisition. The investment benefits from long term income as well as a natural inflation hedge with upside potential in the future. The deal highlights London’s continuing appeal to Asian investors.”