U.S. Duo Buys £900 Million Hotel Portfolio From ADIA

Blackstone and Starwood Capital Group Acquire Nine Hotels in the United Kingdom

Blackstone and Starwood Capital Group have agreed to acquire a portfolio of nine UK hotels from the Abu Dhabi Investment Authority (ADIA) for £900 million. The portfolio includes the Hilton London Paddington, the Hilton London Olympia, and the DoubleTree by Hilton London – Tower of London.

The deal is the latest in a series of large-scale hotel transactions in the UK. In recent months, InterContinental Hotels Group (IHG) has sold its stake in the Holiday Inn London – Kensington High Street hotel to Singapore-based City Developments Limited (CDL) for £130 million, and AccorHotels has sold the Sofitel London Heathrow hotel to the Reuben Brothers for £100 million.

The Blackstone–Starwood Deal

The Blackstone–Starwood deal is the largest hotel transaction in the UK since 2013, when Blackstone acquired a portfolio of 10 Hilton hotels for £525 million. The deal is expected to close in the second quarter of 2023.

The acquired hotels are all located in key gateway cities across the UK, including London, Edinburgh, and Manchester. The hotels have a total of 2,500 rooms and are expected to generate £120 million in revenue in 2023.

Blackstone and Starwood plan to invest £100 million in the portfolio to upgrade the hotels and improve their amenities. The investment will focus on improving the guest experience, including renovating the guest rooms, upgrading the public areas, and adding new dining and fitness facilities.

The deal is a major coup for Blackstone and Starwood, which are two of the world’s largest private equity firms. The acquisition gives Blackstone and Starwood a significant presence in the UK hotel market, and it is expected to generate strong returns for the investors.