The Carlyle Group late last week sold the Millennium Bridge House in London to UK hospitality group Shiva Hotels Ltd. for £87.6 million (US$142.3 million).
The office building located at 1 High Timber Street on the north bank of the Thames will be redevelop by Shiva into a 348-room luxury hotel.
Shiva Managing Director Rishi Sachdev said this acquisition is the latest in a line of significant, high-caliber London deals for the development and operations of landmark hotels.
In the last 18 months, Shiva opened the Hilton London Heathrow Airport Terminal 5, and started to develop a boutique hotel on Buckingham Gate as well as a luxury hotel at Lincoln Plaza in the heart of Canary Wharf. It also plans to open a Hampton by Hilton at London Waterloo and London Gatwick North Terminal by 2014.
Benjamin Du Boulay, director at The Carlyle Group, added, “This transaction is indicative of our ability to find value in a highly competitive London real estate market and to use our asset management initiatives to create an attractive investment opportunity by providing the flexibility to create value through a change of use in the future. Whilst securing planning approval to develop a hotel on the site of Millennium Bridge House, we worked with Old Mutual and our other major corporate occupiers to meet their requirements resulting in the successful re-gearing of a number of the leases in order to maintain income from the property throughout our ownership and de-risk the asset.”