Press Release

Leumi UK refinances Birmingham’s only five-star hotel with Starwood Capital

Posted: 19th April 2021   |   Share

Grand Hotel Birmingham

Boutique bank completes £27 million five-year loan facility with globally renowned private investment firm Starwood Capital

Leumi UK, the London-based subsidiary of Israel’s leading international bank, has completed a deal to provide £27 million to refinance the development costs for the Grand Hotel, Birmingham, the city’s only five-star hotel.

The five-year facility will help finance both the opening and stabilisation costs of the Grand Hotel, which was acquired in 2017 by funds managed and controlled by the global private investment firm the Starwood Capital Group (“Starwood Capital”).

The Grade II-listed, 185-room hotel is due to undergo its grand reopening in May this year, which will include the opening of the hotels’ opulent cocktail bar, Madeleine, and New York-style brasserie, Isaac’s, which is located on Barwick Street.

The Grand Hotel’s reopening will make a major positive contribution to Birmingham’s hospitality offering and play a key role in revitalising Birmingham’s city centre following the pandemic.

The deal marks Leumi UK’s first transaction involving funds managed and controlled by Starwood Capital. Starwood Capital has a primary focus on global real estate and, since its inception in 1991, has raised over $55 billion of equity capital. Starwood Capital currently has in excess of $75 billion of assets under management, including properties within every major real estate asset class.

In recent months, Leumi UK has provided over £135 million in new hotel financing, with transactions including providing development finance for Manex Properties Ltd’s new Amano Hotel in Covent Garden, refinancing for Crimson Hotels’ investment in the 100 Queen’s Gate Hotel London, Curio Collection by Hilton as well as providing finance for the acquisition of the Zetter Group by Orca Holdings.

Stephen Welch, Senior Relationship Manager, Hotel Finance at Leumi UK comments: “We are thrilled to be working with Starwood Capital in helping bring one of Birmingham’s most iconic buildings back to life to create a luxury hotel for Birmingham in the 21st century.

“The fact we have been able to secure such a high profile new-to-bank client while we are still under lockdown is a real testament to the strength and hard work of our hotel finance team.

“While Covid-19 has caused temporary disruption to the hotel market, we remain confident in the long-term demand for high quality accommodation in city centre locations.”

In the news

"Leumi UK completes £27m refinancing of Birmingham's Grand Hotel", The Caterer