Topland readies for £1bn float in 2015

Author: | Date: 18 Jul 2014

Topland Group, the investment house run by multi-billionaire Sol Zakay, is working up plans for a £1bn float of its hotels portfolio within the next year, Property Week can reveal.

The news follows this week’s latest acquisition of Hallmark Hotels for around £75m. The four-star hotel chain takes Topland’s portfolio to 30 hotels across the UK, and the deal is the next step in Topland’s strategy to build a £1bn hotel business. Its current value is estimated at around £500m.

A source close to the company confirmed Topland is seeking to build the portfolio quickly, before announcing its intention to float. The group is now considering the acquisition of two hotel chains in mainland Europe, which will take the overall value of the portfolio to more than £1bn and lead to a float of the business on the London Stock Exchange.

“The question is; what is the exit strategy for the hotel portfolio?” said the source. “It would be sensible to assume that would be a float and it would take place within the next year. Topland is seeking acquisitions aggressively, and is considering one or two deals in mainland Europe at the moment. It could be just one more big deal that takes the value of the portfolio to over £1bn, or it could be a combination of two.”

Property Week has also learned the Hallmark transaction was an all-cash deal, and took less than four weeks to complete. The chain consists of eight four-star hotels, 730 rooms, with 600 employees across the UK including Croydon, Manchester and Gloucester.

Topland now employs close to 2000 people in its hotel business. Its hotels include Bath’s Royal Crescent Hotel, the Brighton Metropole, the Glasgow Hilton and a portfolio of Thistle Hotels, including five in central London and one in Edinburgh.

Topland will add the Hallmark hotels to the platform of the Menzies portfolio acquired in November 2013 and the day to day operations will be managed by Bespoke Hotels, which has been managing the Menzies portfolio.

Topland is one of the UK’s largest private real estate companies, and the Hallmark acquisition follows Zakay’s stated intention to substantially grow Topland’s hotel holdings. This acquisition brings Topland to 3,000-plus hotel rooms in the UK.