The owner of three of London’s most prestigious hotels is close to refinancing more than £600m of debt secured against the properties, ensuring that its loans are not transferred to NAMA.
Maybourne Hotel Group, which owns Claridge’s, the Connaught and the Berkley in Mayfair, is expected to complete the refinancing of around £610m of debt that matures in December before the end of the year.
Deutsche Bank is understood to be one of the banks arranging the refinancing. Bank of Ireland, Anglo Irish Bank and Barclays are the three banks that provide a debt facility to Maybourne, which counts Irish property entrepreneurs Paddy McKillen and Derek Quinlan among its owners and directors.
There had been speculation that the loans secured against the hotels could be transferred to NAMA, the €80bn (£66.9bn) Irish property loan workout agency designed to repair the balance sheets of Irish banks overexposed to property.
With their diverse property interests, Quinlan and McKillen have been widely reported to be among the borrowers whose Irish bank loans could be transferred to NAMA.
However, a source close to proceedings said the Maybourne loans were not put into NAMA in the first wave of transfers that took place in February.
It is understood that the refinancing would allow BoI and Anglo to exit the syndicate that funds Maybourne, thus guaranteeing the loans will not be transferred to NAMA.
The size of the debt facility means that several banks will need to club together to refinance the loan. City sources suggested that the impending maturity of the debt, as much as the need to ensure the loans were not transferred to NAMA, was the driving force behind refinancing talks.
On an operating level, the three hotels and their restaurants have weathered the global financial downturn well. Results for Coroin, the company that owns Maybourne, for the year to 30 June 2009 filed at Companies House last month show that the group’s turnover increased 10% to £104m, while its operating profit of £36m was also a 10% rise. The net book value of the hotels rose from £645m in 2008 to £665m.
