PPHE Hotel Group has completed the £17.5m purchase of a development site near the City of London, earmarked for its first select service hotel in the capital.
The 13,000 sq m mixed-use site, close to Tower Bridge, already has planning permission.
Due to open in 2029, the scheme will include a Radisson Red lifestyle hotel with at least 182 bedrooms, a restaurant, bar and gym, as well as 41,000 sq ft of office space.
The group expects to invest about £90m in total, including the acquisition price, and is targeting an unlevered annual yield in the high single digits once stabilised.
The development will also seek a BREEAM “Excellent” environmental accreditation.
The project is being delivered through a subsidiary of PPHE’s European Hospitality Fund and represents the fund’s second acquisition.
The first was the recently opened five-star Art’otel in Rome’s Piazza Sallustio.
PPHE, which has a £2.2bn portfolio of hotels and resorts across Europe, owns the art’otel brand and operates Arena Hotels and Arena Campsites in Croatia.
It also holds an exclusive licence from Radisson Hotel Group to operate Park Plaza hotels across Europe, the Middle East and Africa.
The company’s shares are listed on the London Stock Exchange and it holds a controlling stake in Arena Hospitality Group, which is listed in Zagreb.
