The Abu Dhabi Investment Authority has been given “preferred bidder” status in the sale of a portfolio of 42 Marriott hotels presently in administration.
ADIA is the latest party to focus on the portfolio, which collapsed 14 months ago owing Royal Bank of Scotland around £850m.
Exclusive talks with the giant Middle East sovereign wealth fund are understood to be for a £620m deal.
This is less than the previous bidder Blue Coast, an Indian hotel firm with backing from wealthy Qatari investors that had previously been in exclusive talks to buy the portfolio for around £720m, before the deal fell through in June.
The under-bidders, which included ADIA, Singaporean firm RB Capital, and Sahara Group, were then approached again to secure a sale.
The Marriott portfolio was previously owned by a joint venture between Israeli investor Igal Ahouvi, Israeli investment company Delek Global Real Estate, and Avestus Capital Partners, the investment company that was formerly Quinlan Private.
It was bought for £1.1bn from Royal Bank of Scotland in 2007, which had in turn bought the portfolio from Whitbread and Marriott for £965m in 2006.
RBS lent £850m against the deal, with a £150m junior portion of this being bought by Lehman Brothers.
The portfolio went into administration in June last year after a hedge fund, York Capital, bought the junior loan and tried to take control of the assets.
Partners at Ernst & Young were appointed administrators, and Jones Lang LaSalle and Hawkpoint were appointed to sell the portfolio.
Bridget.o’connell@estatesgazette.com
