A 140-bedroom Premier Inn in Preston is being sold by it’s owner for £8.7 million pounds in a move that secures the site’s future until 2036.
Kames Capitol is looking to offload the Fox Street building to the successful bidder, who will continue to use the building as a hotel until at least 2036.
Preston’s Premier Inn hotel generates an income of £796,206 a year and is being marketed with a price tag of £8.7m.
Premier Inn’s 25-year lease, signed in 2011, accounts for 91% of the asset’s total income. The building’s ground floor includes German Doner Kebab, clothing retailer Hollywood Exports and Kaspa’s Desserts. These businesses will not be affected by the sale.
Preston’s hotel market could suffer from “a severe supply and demand imbalance in the short to medium term”, according to marketing documents prepared by CBRE.
There is currently one 80-bedroom hotel under construction in the city and the lack of supply could be “exacerbated by the significant regeneration and HS2 development activity which is expected to increase both leisure and business tourism into the city”, CBRE added.
Earlier this year, Preston City Council adopted a regeneration framework for the area around the city’s train station.
The framework sets out a vision for grade A office space, an enhanced retail and leisure offer, and new housing.
Mayfair Capital bought a similarly sized Premier Inn in Leeds earlier this year for £16m. The 136-bedroom hotel was sold by Town Centre Securities in an off-market deal.