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KENSINGTON, LONDON W8 KENSINGTON CLOSE HOTEL
Kensington, London W8
Kensington CLoseHoteL
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INVESTMENT HIGHLIGHTSPRIME LONDON LOCATIONKensington Close Hotel occupies a superb location in the heart of London’s affluent suburb of Kensington in the Royal Borough of Kensington and Chelsea. The Hotel benefits from a strategic location within easy walking distance of many of London’s major tourist attractions, luxury shopping districts and transport links. As the birthplace of the boutique and lifestyle hotel in the 60’s, the Royal Borough of Kensington and Chelsea is now home to the world’s most expensive hotels and homes.
RARE CENTRAL LONDON FREEHOLDThe 310,229 sqft (28,821 sqm) property is held on a freehold title and occupies a site of 1.59 acres (6,475 sqm) in prime central London. Surrounded by some of the world’s most expensive residential property, Kensington Close Hotel is one of the top ten largest hotels in London comprising 708 en-suite bedrooms along with extensive public areas including restaurant, cafe, bar, 7,240 sqft (673 sqm) of conference & banqueting space and a health club.
REPOSITIONING & REBRANDING POTENTIALSince the property was converted to a hotel in 1960, the Kensington Close Hotel has been independently owned and operated and has an established and highly regarded trading profile in the London market allowing it to achieve consistently high occupancy levels. Now, in recognition of the changing landscape of luxury lifestyle hotels, and the ever-increasing reputation of Kensington, the property is being offered for sale unencumbered by brand and management. This creates an outstanding opportunity for real estate developers and hotel investors to explore the full potential and flexibility this property offers.
WORLD’S MOST DESIRABLE HOTEL INVESTMENT MARKETLondon remains one of the strongest hotel operating markets in Europe and is one of the most keenly sought-after real estate investment markets in the world. Underpinned by strong property fundamentals, London also benefits from exceptional corporate and leisure demand drivers ensuring long-term demand growth whilst Kensington and the surrounding area is characterised by a notable shortage of sites providing high barriers to entry and little scope for increased competition in the medium term.
POTENTIAL DEVELOPMENT OPPORTUNITIESKensington Close Hotel is located within a thriving commercial and residential location within prime central London, and the age and style of the building suggests the site may offer unique potential as a substantial mixed-use redevelopment opportunity featuring new build hotel, residential and commercial elements.
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LONDONLocated within a tranquil oasis a short walk from Kensington High Street, and surrounded by some of London’s most expensive residential properties, Kensington Close Hotel occupies an enviable position at the heart of the Royal Borough of Kensington and Chelsea.
FINANCEA safe haven for foreign investment and the finance capital of Europe, 75% of the Fortune Global 500 companies have a presence in London and one third of these companies choose London for their European Headquarters. As such, London is universally regarded as the world’s leading international financial and business centres and a key driver of the UK economy.
CULTURELondon’s greatest cultural institutions are on the doorstep of Kensington Close Hotel with the Natural History Museum, the Victoria & Albert Museum, Kensington Palace, and The Royal Albert Hall all located within a short walk of the Hotel. London is the top European destination for international tourists ranked by visitor numbers. Olympia Exhibition Centre, Imperial College and The Royal Marsden hospital are also on its doorstep; all of which are key demand generators for the Hotel.
LIFESTyLEKensington is also renowned for its high end shopping, with Harrods and other luxury boutiques in the Knightsbridge and Chelsea area also within walking distance of the Hotel. Additionally, a plethora of restaurants and cafes are located along Kensington High Street, situated in close proximity to the Hotel.
Hyde Park and Kensington Gardens, two of London’s eight Royal Parks, are only moments away and are home to a number of famous landmarks including the Serpentine Lake spanned by the wonderful Serpentine Bridge, the Diana Memorial Fountain and the famous Wellington Monument.
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LONDON HOTEL OPERATING MARKETAs the most desirable hotel market in the world, London benefits from an incredibly diverse array of demand drivers and global source markets, which make for a robust and unwavering market performance.
The city benefits from its geographical location between the Americas and Asia, and thus has subsequently paved the way for unrivalled financial and logistical accessibility. Today, 40% of foreign equities, more than anywhere else in the world, are traded in London whilst 89% of global cities are connected by non-stop flights at least three times a week from one of London’s six international airports.
These abundant demand drivers, and constricted supply of new hotel stock, have resulted in robust trading dynamics with key performance indicators over the past four years consistently outperforming other international markets. London has historically proven exceptionally resilient at absorbing new stock, as illustrated below.
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95%90%85%80%75%
70%65%60% 200
205210215220225230235240245250255
2010
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Room
s sol
d x 1
0,00
0
2011 2012 2013 2014
OccupancyRooms Sold
KENSINGTON HOTEL SUB-MARKETThe Kensington hotel sub-market benefits from all of the fundamentals that make London one of the top revenue performing hotel markets in Europe. Rich in history, culture, arts and retail, Kensington unequivocally appeals to the leisure segment and achieves impressive annual occupancy. Furthermore, the neighbourhood boasts the most highly qualified population in the UK and has thus built a reputation in the professional service sector, driving corporate demand.
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95%
90%
85%
80%
75%
70%
65%
60%
Mar
13
Room
Occ
upan
cy
Apr 1
3
May
13
Jun
13
Jul 1
3
Aug 1
3
Sep
13
Oct
13
Nov
13
Dec
13
Jan
14
Feb
14
Mar
14
Apr 1
4
May
14
Jun
14
Jul 1
4
Aug 1
4
Sep
14
Oct
14
Nov
14
Dec
14
Jan
15
Feb
15
KCH
Westminster
RBKCLondon
LONDON HOTEL OCCUPANCy VERSUS TOTAL ROOMS SOLD (INDExED) 2010 – 2014
FULL-SERVICE ROyAL BOROUGH OF KENSINGTON AND CHELSEA (RBKC), WESTMINSTER AND WIDER LONDON HOTEL MARKET V KENSINGTON CLOSE HOTEL OCCUPANCy 24 MONTHS TO FEBRUARy 2015
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A3220W
Cross Rte
Holland Park Avenue
A402
A3220
A3220
A3220
Finborough RoadQ
ueen’s Gate
Gloucester Road
A3220
A3220
Earl s Court Road
A4 West Cromwell Road
A4
A4
A315 Kensington High Street
A315 Kensington Road
Knightsbridge
Old Brompton Road
Kensington Church Street
A315 Kensington High Street
A315 Kensington Road
Knightsbridge
South Kensington
Gloucester Road
Earl’s CourtWest Kensington
Kensington Olympia
Shepherd’s Bush
Holland Park
Notting Hill Gate
Queensway
High Street Kensington
Kensington Gardens
Holland Park
Hyde Park
Barons Court
Hammersmith
Knightsbridge
2
23
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67
89
1011
12
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Marker Hotel Name Rooms Operator
Kensington Close Hotel & Spa 708 Cola Holdings
2 Hilton London Olympia 405 Hilton Worldwide
3 Copthorne Tara Hotel London Kensington 833 Millennium & Copthorne
4 Park International 172 Hospitality Lodging South
5 Holiday Inn London Kensington Forum 906 Redefine BDL Hotels
6 Hotel Indigo London Kensington - Earls Court 100 Cairn Group
7 K&K Hotel George 154 Highgate Hotels
8 Millennium Bailey's Hotel London Kensington 212 Millennium & Copthorne
9 London Marriott Hotel Kensington 216 Marriott
10 Millennium Gloucester Hotel London Kensington 610 Millennium & Copthorne
11 Ambassadors 150 Center London Hotels
12 NH Kensington 121 NH Hoteles
13 Best Western Burns 104 Lowy Hotel Solutions
14 Crowne Plaza London Kensington 162 InterContinental Hotels Group
15 Harrington Hall 200 Independent
16 Radisson Blu Edwardian Vanderbilt 215 Edwardian Group
17 Royal Garden 394 Goodwood Group
COMPETING KENSINGTON HOTELS
Not to scale. For indicative purposes only.
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CONNECTIVITy The Hotel benefits from good transport links with High Street Kensington underground station (District and Circle lines) 0.2 miles north, Gloucester Road underground station (Piccadilly, District and Circle lines) 0.7 miles south east and Notting Hill Gate underground station (Central, District and Circle lines) 0.9 miles north providing access to the West End and the City. Additionally, a variety of bus routes operate along Kensington High Street connecting to all areas of London.
Paddington Station (1.6 miles north east) provides national rail connections, including the Heathrow Express. Cromwell Road (A4), one of London’s main arterial routes, is 0.4 miles south of the site providing direct access to the M4 and on to the M25 and national road connections.
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PROPERTy OVERVIEWKensington Close Hotel was built in 1939 as a ‘residential club’, accommodating apartments, a restaurant, recreation rooms and garages. The property was developed by Charles Peczenik, an engineer and property developer who was involved with the rebuilding of much of Grosvenor Square.
The Hotel underwent a change of use and extension in 1960 to provide a 550 bedroom hotel. A further extension was completed in 2012 resulting in the room count increasing to 708.
The Property comprises a full service 4-star hotel with a cafe, bar/lounge, restaurant, conference & banqueting facilities and a health club arranged over lower ground, mezzanine, ground and six upper floors.
FLOOR ACCOMMODATION
Lower Ground
Health clubCar parkingStaff accommodationPlant
Mezzanine Health club changing rooms
Ground
CafeReceptionBar/LoungeConference & banqueting roomsRestaurantKitchenGardenBack of HousePlant
First to Sixth Guest bedrooms
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GUEST ROOMSKensington Close Hotel provides 708 well appointed and proportioned guestrooms. The guestrooms are all en-suite and provide a good mix of modern amenities such as flat-screen TV’s , individually controlled air conditioning and Wi-Fi.
A breakdown of the room types can be found below.
ROOM TyPE NUMBERSingle Standard 78Double Standard 195Twin Standard 108Double Superior 31Twin Superior 30Double Executive 215Executive Club 49Suites 2TOTAL 708
FOOD AND BEVERAGE FACILITIESCaffe MusettiThe Hotel benefits from its own in-house cafe, Caffe Musetti. The cafe is situated in the main hotel lobby opposite the reception desks and provides informal seating in the conservatory.
Lounge BarThe lounge bar is situated between the Hotel lobby and conferencing suites and serves drinks, afternoon tea and snacks in a relaxed and air conditioned seating area.
Boulevard RestaurantAs the main hotel restaurant, the Boulevard Restaurant is used for breakfast lunch and dinner. The restaurant provides c.300 covers and also benefits from direct access to the garden which, during the summer period, offers al fresco dining.
CONFERENCING & BANqUETING FACILITIESThe Hotel benefits from extensive conference & banqueting facilities. All function rooms are located on the ground floor and are accessed through the main Hotel lobby, with each having access to a breakout area. All conference & banqueting rooms feature air-conditioning and audiovisual facilities.
We provide below a breakdown of the conference and meeting rooms with maximum capacities and approximate areas.
ROOM MAx CAPACITy SIZE SqMBuckingham 1 40 45.6Buckingham 2 40 39.8Buckingham 1 & 2 100 85.8Windsor 1 60 51.4Windsor 2 40 43.1Windsor 1 & 2 120 94.5St James 1 14 14.7St James 2 14 19.6St James 1 & 2 30 35.8Balmoral 1 100 79.5Balmoral 2 150 113.8Balmoral 1 & 2 250 198.1Balmoral 3 200 170.0Boardroom 1 12 29.4Boardroom 2 12 29.4Boardroom 3 12 29.4TOTAL 736 672.4
LEISURE FACILITIESThe Hotel features a health club which operates under a management contract with Mosaic Spa and Health Clubs. The health club features a gym (with cardiovascular equipment, multi-gyms and free weights), swimming pool, sauna, steam room, hot tub, fitness studios and treatment rooms.
CAPITAL ExPENDITURE SUMMARyThe Hotel underwent a significant refurbishment between 2010 and 2012, with approximately a £35 million being invested by Cola Holdings. The comprehensive refurbishment included updating the M&E infrastructure, renovating the health club along with approximately 500 of the existing bedrooms plus developing an additional 160 new guestrooms.
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FLOOR PLANS
GROUND FLOOR
FIRST FLOOR
FOURTH FLOORNot to scale. For indicative purposes only.
Not to scale. For indicative purposes only.
Not to scale. For indicative purposes only.
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DEVELOPMENT POTENTIALKensington Close Hotel sits on a significant 1.59 acre site in Kensington, within prime central London. Given the location, size and age of the building, it undoubtedly provides a substantial potential redevelopment opportunity.
The property is situated within the jurisdiction of the Royal Borough of Kensington and Chelsea. We understand demolition of the existing building would not be opposed, therefore offering an incredibly rare chance to create a major mixed-use new build scheme including hotel, leisure, retail and residential uses subject to obtaining the necessary consents
Kensington is an established and affluent area, long known for traditional and exclusive homes, a fashionable and independent retail offering, convenient access to the West End and City as well as having pleasant garden squares and two of central London’s best known parks; Kensington Gardens / Hyde Park and Holland Park.
It is for these reasons that Kensington has recently been the location of a number of new build luxury residential developments; One Kensington Gardens by Lancer Property Asset Management, Vicarage Gate by Northacre, Holland Green by Chelsfield and Campden Hill by Native Land and Grosvenor. These schemes have raised the benchmark for luxury living in Kensington and redefined the area as a positive lifestyle choice.
While Kensington is home to many affluent residents, it also caters to high-end fashion boutiques, global brands and independent retailers. This attracts consumers from across London as well as satisfying tourism trade which circulates from attractions such as the Royal Albert Hall and Kensington Palace. Footfall is currently thought to be in the region of 15 million and current occupancy levels are high reflecting the high demand for space in Kensington.
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EPCKensington Close Hotel has an EPC rating of B
TENUREThe freehold site is comprised of four parcels of land registered with the Land Registry under title numbers BGL5315, BGL5316, BGL5317 and BGL4736.
Ward Bdy
10.3m
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SCARSDALE
PLACE
CHENISTON GARDENS
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Stone Hall Gardens
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William Cobbett House
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Sutherland
Cedar House
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Kensington Close Hotel, London
METHOD OF SALEThe Hotel is being marketed for sale on a private treaty basis, free of any brand or management encumbrances and subject to contract only.
The Hotel is for sale through a transfer of 100% of the issued share capital of the proprietary company, Kensington Close Hotel Limited, which is a single asset Special Purpose Vehicle and which owns a 100% interest in the site.
FURTHER INFORMATIONFollowing receipt of a signed confidentiality agreement, access to a full information pack in relation to the opportunity is available on the project website www.KensingtonClose.co.uk and includes:• Investment analysis• Floor plans • Hotel operational information• Energy Performance Certificate
NO
TE:- Reproduced from the O
rdnance Survey Map with the perm
ission of the C
ontroller of H.M
. Stationery Offi
ce. © C
rown copyright licence number
100024244 Savills (UK) Ltd. N
OTE:- Published for the purposes of identification
only and although believed to be correct accuracy is not guaranteed.
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CONTACT
GEORGE NICHOLASGlobal Head of [email protected]+ 44 (0) 20 7499 8644
ROBERT [email protected]+ 44 (0) 20 7409 8029
RAyMOND CLEMENTManaging Director - [email protected]+65 6415 7570
JULIEN NAOURIAssociate [email protected] + 65 6415 7583CEA Reg. No.: R003905I
RESIDENTIAL DEVELOPMENT
TIM [email protected] + 44 (0) 20 7409 9999
LIZZIE [email protected] + 44 (0) 20 7409 9943
ROBERT SEABROOKExecutive [email protected]+44 (0) 20 7182 3867
SEAN PACEyAssociate [email protected]+44 (0) 20 7182 2471
JILEEN [email protected]+44 (0) 20 7182 3933
VIEWINGAll viewings are strictly by appointment only. Please contact the selling agents below to arrange a viewing.
Important NoticeSavills, CBRE and their clients give notice that:They are not authorised to make or give any representations or warranties in relation to the property either here or elsewhere, either on their own behalf or on behalf of their client or otherwise. They assume no responsibility for any statement that may be made in these particulars. These particulars do not form part of any offer or contract and must not be relied upon as statements or representations of fact.Any areas, measurements or distances are approximate. The text, photographs and plans are for guidance only and are not necessarily comprehensive. It should not be assumed that the property has all necessary planning, building regulation or other consents and Savills have not tested any services, equipment or facilities. Purchasers must satisfy themselves by inspection or otherwise.Designed and Produced by Savills Marketing: 020 7499 8644 | October 2015
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