• The new development will consist of a 222-bedroom, upper-midscale hotel;
• The hotel will be operated by Motel One, a Munich-based affordable lifestyle companywhich operates over 90 hotels across 14 countries in Europe and the US;
• Located in SE1, the new hotel will be a short walk from key tourist attractions such as Tate Modern, the London Eye, Borough Market, and The Shard;
• The loan from OakNorth provides capital to refinance existing debt, part-fund the development costs and working capital for the initial opening months of the hotel.
OakNorth – the digital bank for entrepreneurs by entrepreneurs, has provided a £45.7m loan to investment firms, Veld Capital and Maya Capital, to support the development of a major new hotel at 160 Blackfriars Road.
Founded in 2009, Veld Capital is a private investment firm focused on credit-oriented opportunities across a broad range of asset types. To date, it has raised €2.7Bn, making over 100 investments across 15 countries. Meanwhile, Maya Capital was founded in 2014 by David Pralong, and has invested c.£400m across 17 deals, with nine exits to date. The capital from OakNorth will enable the two investment firms to fund the development of a new 222-bedroomhotel operated by Motel One, with offices on the ground floor.
OakNorth’s expertise across both property development and SME trading deals, meant it was able to tailor a facility that will enable Veld and Maya Capital to refinance existing debt on the site, fund the development of the hotel, and cover the initial costs of operating it. This compares to other lenders who will typically make the borrower take out a facility to acquire the site, then a development facility to build it, and then they’ll have to refinance if they want the capital to run it.
Sebastien Wigdo, Partner of Veld Capital, commented: “We are pleased to have collaborated with OakNorth on this financing. It represents another key milestone in the repositioning of the asset, after having obtained planning for our proposed hotel scheme and completed the full refurbishment of the office component into a high quality, ESG compliant space. We look forward to starting constructionand delivering the hotel to be managed by Motel One.”
David Pralong, Managing Partner of Maya Capital, continued: “We are thrilled to develop this new Motel One project in Southwark, thanks to the loan we received from OakNorth. Our partnership with Motel One has enabled their first Hotel Management contract in Europe and we look forward to continuing our work with the company.”
Deepesh Thakrar, Senior Director of Debt Finance at OakNorth, added: “Both Veld and Maya Capital are well-established private equity firms with a demonstrated track record of developing assets and exiting well. They have found a strong and experienced operator in Motel One, and are well-located to attract the tourists they’re aiming for. As one of the few lenders that can provide an umbrella facility like this, we’ve been able to support Veld and Maya in the buy, build and stabilise under oneagreement. This means they’ve been able to cut out the time needed to refinance once the hotel is built, saving them a big headache further down the line.”
Veld Capital and Maya Capital were advised by Lisa Attenborough at Knight Frank and Gurinder Mann of Gowlings.
OakNorth was advised by Louis Dewfall of Taylor Wessing.
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