The City of Gloucester is an historic City located in the Cotswolds and is popular both with tourists and business visitors. Our client, who already owned and operated a hotel in Cheltenham, recognised the need for a niche limited service hotel within Gloucester and set about looking for a suitable property.
A site was found in the centre of Gloucester which suited the type of accommodation our client wanted to offer. After liaising with the local council and being satisfied that the council supported his plans the next step was securing the finance with which to purchase the premises. That’s where Stewart Hindley & Partners came in, we had previously worked with the client on another project and he was happy to work with us again on this one knowing the level of commitment we give to each case and the professionalism we provide on the debt proposal.
The finance was a challenge in that limited service hotels are a fairly new concept in the UK and the lenders were initially reluctant to lend, however, we presented a comprehensive business plan together with his current trading accounts and projected accounts which provided them with all the information they required providing a level of confidence which is sometimes lacking in non-professional applications.
Meetings between the lender, Stewart Hindley & Partners and the client were conducted on and off site and all queries were answered. With the help of our client we were able to show that Gloucester City Council had a strategic plan for the town as a whole and that a new shopping development would enhance the need for this type of hotel, as well as the need for a cost effective business travel solution. Ultimately the lender was happy to offer debt at 65% LTV at a great rate of 2.35% gross over a 20 year period. The deal has now gone through to completion.
What is a Limited Service Hotel?
A limited service hotel is one that provides a good standard of accommodation with basic self -catering facilities in the rooms i.e. tea/coffee making equipment and microwave. There are no bar or restaurant facilities on site. As this particular hotel is based in the centre of the town it is easy for guests to visit restaurants and other food outlets if they don’t wish to cater for themselves. By offering a limited service the hotel is able to provide a good standard of accommodation, in a town centre location for a budget price.