easyHotel PLC easyHotel takes over Tune hotel in Newcastle (5040W)

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RNS Number : 5040W

easyHotel PLC

15 November 2017

15(th) November 2017

easyHotel plc

easyHotel plc

("easyHotel", "the Group" or "the Company")

easyHotel takes over Tune hotel in Newcastle

easyHotel, the owner, developer and operator of "super budget" branded hotels, announces that it has agreed to take over the 104 room Tune hotel in Newcastle, UK.

The hotel at Proctor House, 23-29 Side, Newcastle, is centrally located between the City Centre and The Quayside, and an 8-minute walk from Newcastle Central Station. The property, which opened as a hotel in 2014, is in excellent condition and will open as an easyHotel next month following minor rebranding works to the building.

Newcastle is the largest City in the North East, famous for its bar and nightlife scene, attracting 2 million visitors per year. The City is home to a number of businesses and leisure attractions, including The Baltic Centre, The Great Northern Museum, The Metro shopping centre and Newcastle United Football Club.

Newcastle will be the Group's second leased site. The hotel will be let on a 25-year FRI (fully repairing and insuring) lease at an annual rent of GBP442,000.

As previously outlined, whilst the Board is focused on accelerating the Group's expansion through owned and franchise hotel development, it will consider specific leased sites, providing they enable the Group to build a footprint in strategic gateway locations. The Board applies strict due diligence when assessing lease opportunities, stress testing a minimum risk adjusted rent cover in line with hotel sector standards.

This selective approach to leased opportunities will enable the Company to increase the number of hotel rooms under its direct control, grow its earnings at a lower capital cost and maintain the Group's (blended) ROCE target of 15%.

Commenting, Guy Parsons, CEO of easyHotel plc, said:

"This is an excellent opportunity to establish a footprint in the vibrant and popular City of Newcastle. The 104 rooms will require minimal work to bring them in line with our brand and we will open the new easyHotel Newcastle next month.

"It has been a year of accelerated growth for the Group, validating our strategy of offering comfortable, affordable accommodation in key tourist and business locations in the UK and internationally. The Board looks forward to announcing further opportunities for the easyHotel brand as we continue to expand our development pipeline."

Enquiries:

 
 easyHotel plc 
 Guy Parsons, Chief Executive    www.easyhotel.com 
  Officer 
 Marc Vieilledent, Chief         http://ir.easyhotel.com 
  Financial Officer 
 
 Investec (Nominated Adviser 
  and Broker)                    [phone] 
 David Anderson 
 Houston PR (Financial 
  PR)                            [phone] 
 Kate Hoare 
 

Notes to Editors:

www.easyhotel.com http://ir.easyhotel.com

easyHotel is the owner, developer, operator and franchisor of branded hotels. Its strategy is to target the "super budget" segment of the hotel industry by marketing "clean, comfortable and safe" hotel rooms to its customers.

Operating hotels

easyHotel's six owned hotels currently comprise 598 rooms, and it has a further 20 franchised hotels with 1,750 rooms.

Owned hotels:

Old Street (London), Glasgow, Croydon, Birmingham, Manchester, Liverpool.

Franchise locations:

Belgium (Brussels), Bulgaria (Sofia), Germany (Berlin, Frankfurt), Hungary (Budapest), The Netherlands (Amsterdam: City, Arena & Zaandam, Rotterdam, The Hague), Switzerland (Basel, Zurich), UAE (Dubai), United Kingdom (Edinburgh, London Heathrow, Central London, Luton).

Hotel development pipeline

The Company's committed development pipeline of owned and franchised hotels currently consists of:

Owned hotels:

United Kingdom (Ipswich, Sheffield, Leeds), Spain (Barcelona) Subject to planning consent: United Kingdom (Cardiff and Oxford - lease).

Franchise hotels:

UAE (Dubai), Germany (Bernkastel-Kues), Portugal (Lisbon), Turkey (Istanbul), UK (Belfast, Reading), Iran, Sri Lanka.

This information is provided by RNS

The company news service from the London Stock Exchange

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November 15, 2017 02:00 ET (07:00 GMT)