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Accor Agrees to Sell 30 UK Hotels

LONDON-Land Securities Group will pay $921.31 million (euro 711 million) for 5,000 rooms in 30 Ibis- and Novotel-branded properties.

By Brian K. Miller | Updated on February 12, 2007

LONDON-Accor SA has agreed to sell 30 hotel properties in the UK as part of its strategy to manage rather than own hotel assets. The Ibis- and Novotel-branded hotels, which contain a combined 5,000 rooms, are being sold to Land Securities Group for $921.31 million (euro 711 million).

The hotels are predominantly located in established city center locations across the UK, with a weighting towards London, according to Land Securities. As part of the deal, Accord will operate the hotels under 12-year variable leases and the new owner will invest 68.67 million (euro 53 million) to upgrade the properties.

The leases are renewable six times, for a total of 84 years. The associated rents will be based on an average 21% of annual revenues with no guaranteed minimum. The variable rent for 2006 would have amounted to $53.12 million (euro 41 million).

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