UK: Investor Asif Aziz, owner of Criterion Capital, has purchased Haymarket House in Soho, London, with plans to convert the upper floors into a £400 million hotel.
Haymarket House was sold by joint venture partners CPPIB and Hermes Real Estate Investment Management Limited for around £135 million. Savills Hotels acted as advisors on the sale.
The site is currently occupied by a restaurant and comedy club on the ground floor, which will remain as part of the deal. The upper-floor office space has been earmarked for a £400 million hotel conversion.
“The office market is polarised. People want new buildings that are best in class. Most of the buildings in central London and the city that are vacant can never be best in class. So an alternative use has to be found in this case, [a] hotel because Haymarket House is in an area with the highest tourist footfall in Europe. It’s really the combination of perfect location coupled with a building that basically has come to its end of its use as an office and isn’t particularly well suited to an office,” said Aziz to City A.M.
Robert Stapleton, head of UK hotel capital markets at Savills, said: “This transaction received exceptional levels of interest from a broad range of capital sources, which is a testament to the continued strength of appetite for UK hotels. The clear consensus on value that was demonstrated by the bidding parties was also extremely positive, particularly given the varying costs of capital and business plans underwriting their offers.”
Richard Dawes, director of hotel capital markets at Savills, added: “This transaction is further evidence of the continued liquidity in office-to-hotel conversions in London. In 2023 Savills Hotels has advised clients on over £250 million of conversion deals, with more in the pipeline for 2024.”
Aziz is the co-founder and CEO of Zedwell Hotels, a lifestyle hotel brand focussed on sleep and wellbeing. Under its operating arm Criterion Hospitality, the group also has existing two and three-bedroom apartments at Haymarket, Piccadilly.