Dalata Hotel Group has signed an agreement with the real estate investment group Deka to divest Clayton Hotel at Charlemont in Dublin, Ireland, for €65m.
Under the agreement, Dalata will also leaseback the hotel, which is situated adjacent to the Grand Canal. For a 35-year lease period, Dalata will pay just more than €3m annually in rent, reported RTE.ie.
Clayton Hotel features 187 bedrooms, a bar and restaurant, a fitness facility and meeting rooms.
In February 2016, Dalata acquired the location and began construction later that year. The hotel became operational in November 2018.
The firm invested €41.6m for the acquisition of the location and development of the hotel.
Under the latest deal, Dalata will complete the final part of the hotel development, which will see a transformation of 38 Charlemont Street into three additional Clayton bedrooms and a café, reported the news agency.
These development works are slated to complete in 2020. However, these works will not lead to change in property rent.
Dalata’s deputy chief executive for business development & finance Dermot Crowley said the company began work on this transaction before the Covid-19 pandemic.
Crowley was quoted as saying: “Completing a transaction such as this despite the onset of the crisis demonstrates the commitment of both Deka and Dalata to this partnership and their long-term commitments. The agreed terms for this transaction reflect both the quality of the asset and the strength of Dalata’s balance sheet.”
Proceeds from the deal will help the hotel firm to bolster its cash resources during the present Covid-19 crisis.