Maven Capital Partners (Maven), one of the UK’s most active Private Equity and Property fund managers, announced that it has successfully completed a £15 million transaction for the purchase and refurbishment of the Grade II listed Shire Hall in Durham, for conversion into an 81-bedroomed 4-star boutique hotel.
The refurbishment of Shire Hall qualifies for Business Premises Renovation Allowance (BPRA) and funding for the project includes a £5.25m equity raise by Maven.
BPRA provides tax incentives to encourage the refurbishment of empty commercial properties, bringing these buildings back into use, helping stimulate local economic regeneration and creating employment. Changes to the areas that qualify for BPRA in 2014 saw Durham included for the first time, thus facilitating the redevelopment of Shire Hall.
Originally built in 1890s as the headquarters for Durham County Council, Shire Hall will be sympathetically renovated into a Hotel Indigo, the up-market, boutique brand of InterContinental Hotels Group (IHG), with a 150-cover Marco Pierre White (MPW) Steakhouse Bar & Grill. The hotel will be managed by leading hotel management company, Interstate Hotels and Resorts. The property boasts a number of impressive period features such as the grand tiled marble staircases, wood panelling and stained glass windows that will be retained and form the basis for the 81 en-suite bedrooms. The circular debating chamber and lobby room will also be retained, providing an iconic setting for a cocktail bar and the MPW restaurant.
Durham enjoys strong demographics in terms of local spending power with a key role played by Durham University, one of the top ranked Universities in the UK with an enviable international reputation. Tourism plays a significant part in Durham’s economy, but there is a widely recognised shortage of quality hotel accommodation.
The hotel will enjoy commanding views of Durham Castle and Cathedral in the heart of Durham’s historic city centre, a UNESCO World Heritage site.
Shire Hall was purchased from local businessman Kevin Brown. Kevin and his business partner, experienced Durham-based developer Shaun Crawley, will be primarily responsible for the refurbishment of Shire Hall, which is expected to take 15 months with the hotel being scheduled to open in the autumn of 2017.
Ramsay Duff, Investment Director at Maven, who led the deal said: “Maven is delighted to be involved in this prestigious project, bringing such a magnificent building back into use and allowing us to further develop our relationships with IHG and the hotel Indigo brand, Interstate and MPW.
We anticipate that the Hotel Indigo at the historic Shire Hall will not only become a ‘must visit’ destination, but also address the demand that exists in the city for more high-quality hotel accommodation.
“These deals are challenging to pull together and we are grateful for the support of our developer partners, bank, legal and tax advisors and of course for the on-going support of our investors.”
Robert Crook, Interstate’s Managing Director for the UK, added: “We are delighted to being working alongside Maven Capital Partners on such a unique and significant project, and look forward to working alongside the owners to realise the full potential of what is sure to be an exceptional hotel”.
Nick Taplin, chief executive at Black & White Hospitality, who own the franchise rights to MPW Steakhouse Bar & Grill, said: “This is our third development with Maven Capital after Glasgow and Cardiff and we’re delighted to be continuing a very strong business relationship together.
“Marco and I have been eager to find a suitable location in the city for some time. We know that Durham has a real appetite for affordable glamour and restaurants that offer top quality dishes in a sumptuous environment, at a price to suit all budgets.”