UBS Asset Management buys Edinburgh hotel

The real estate arm of UBS Asset Management has acquired the Edinburgh Travelodge Hotel as it aims to further diversify its long income UK property fund.

Bought from a private individual for £9.4 million (€10.3 million), the property will continue to be operated by Travelodge Hotels Limited on a long-term lease basis until 2042.

The investment reflects a net initial yield of around 5.25%, according to the Swiss firm. The acquisition diversifies the tenant mix within the UK property fund, it said.

Located in Edinburgh’s West End, the five-storey hotel comprises 73 en-suite bedrooms, as well as a restaurant and the standard common lobby space on the ground floor.

According to the firm’s head of real estate and private markets (REPM), Jonathan Hollick, the property will offer a stable, long-term indexed cash flow.

“The performance of the Edinburgh hotel sector is second only to London,” he said.

©2019 funds europe

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