RBS in £720m Grosvenor sale talks

  Royal Bank of Scotland is in talks to sell one of London’s best-known hotels to a private Middle Eastern investor.   The bank is understood to be entertaining a £720m bid from the investor for the 494-bedroom Grosvenor House hotel on Park Lane, W1.   RBS has been looking at a potential sale of the five-star hotel – which has just had a £100m makeover from operator Marriott International – since summer 2007 (28 July, p21).   It was originally seeking £650m for the property, valuing it at £1.3m a bedroom.   A number of parties have expressed interest, including the Bahraini royal family that owns the nearby 219-bedroom Four Seasons Park Lane.   One hotel source said: “Middle Eastern investors have come to the fore recently because their competitors – debt buyers – have all fallen away. Investors from the Middle East have got a better opportunity as they are the only buyers in the market with cash.”   Middle Eastern investors are also known to like to own the places in which they stay.   The Qatar Investment Authority – which this week bought a 20% stake in developer Chelsfield (p40) – has recently been building up a luxury hotel portfolio.   In July, its subsidiary, Qatari Diar, proposed to become a strategic shareholder in the Société des Bains de Mer – the listed hotel group controlled by the Principality of Monaco. The subsidiary also owns a 22.7% stake in the company that controls the Majestic and Gray d’Albion hotels in Cannes.   The Grosvenor House hosts a variety of functions in its Great Room – including this week’s EG Awards (see below).   RBS took over ownership of the hotel in 2003 when hotel operator Le Meridien collapsed into administrative receivership.   A number of other hotels that it acquired after the collapse of Le Meridien have been sold this year, including the 881-bedroom Park Inn at Heathrow, the 148-bedroom Marriott Victoria & Albert hotel in Manchester and the 299-bedroom Hilton Waldorf on Aldwych, WC1.   RBS refused to comment.   annabel.dixon@rbi.co.uk