BREAKING NEWS!

Travelodge and Meghraj have recently started on site with their first scheme in Canterbury City Centre, where the former Chaucher Hotel is being converted by Travelodge into a 60 bed Travelodge to offer the first branded budget hotel in the City Centre. This project is being funded by Meghraj and Travelodges investment vehicle, Tamesis, which has been established to invest specifically in Travelodge leases of existing hotels. To find out more about Tamesis please click on the link here or alternatively please email john.hardy@tamesiscapital.com with opportunities for consideration. 

A key part of Travelodge’s new openings programme is delivered by acquiring existing hotels (Going Concerns) that fit the company’s locational and branding criteria and the business has successfully completed a number of important transactions in this way over the last few years. Our most recent transaction involved the major acquisition of the leases of 52 Inn Keepers Lodges from pub company Mitchells and Butlers (for more information please see our press release). This demonstrates our ability to conclude major "corporate" transactions, but we have also acquired approximately 20 going concerns through individual transactions during the last three years. 

Going Concerns have the attraction of being delivered to the business without the unpredictable lead time of  both the planning and construction processes. In common with Travelodge's growth strategy, all of them are dealt with under our standard leasehold model, with an occupational rack-rented lease being granted to Travelodge using our institutionally acceptable form. 

Travelodge Going Concerns projects fall into three categories:

• Shut and Gut: these hotels cannot be converted into the brand without the need for extensive refurbishment and the nature of the works is such that these works cannot be carried out in a trading environment. Generally, these schemes involve the creation of new rooms from public/function rooms or a re-planning of the floor layouts and the need for either Listed Building Consents or planning approvals is not unusual. Recent examples include Edinburgh Rose Street (opened March 2010) and Northampton Central (opened July 2010).

• Traded refurbishment: a hotel that is in good decorative order, with a room matrix that lends itself to the brand, so that works can be carried out by taking floors off-line to enable the required works to be completed whilst the hotel is still trading. Scope of works tends to centre on the replacement of furniture, with Travelodge 2010 bedroom Specification installations and redecorations includeing new carpets etc. Recent examples include Stransted Bishops Stortford (2010), Brighton Seafront (2009) and Edinburgh Shandwick Place (2009).

• Re-badge: a property that is capable of immediate trade without closure, but where works are limited to non-intrusive scope items, such as new signage, small item orders and branded collateral. Existing furniture is retained and en suites are left intact, with works limited to removal of soap dispenser etc. Recent examples include the former Purple hotels at Sheffield Meadowhall, Tewkesbury and Derby Pride Park (2009) and Ramada Encore York Micklegate (2010).

The following audio/visual, which explains how we converted an existing hotel on Worthing Seafront, should help you understand how our Going Concern conversion process works.dvd

In addition, the "before" and "after" shots of our newly completed scheme at Northampton, which are in this pdf, give you a good illustration that our conversion works bring about. 

The majority of these deals are structured around the Landlord funding the required works to the building, to maximise the rental potential of the asset, which will either underpin the Landlord's investment with Travelodge as the tenant or aid the Landlord's onward sale of the investment that has been created with Travelodge in situ. Unless the scheme is a Shut & Gut, the deal will invariably involve a transfer of the various business assets held by the outgoing hotelier, with all room bookings, FF&E and human resources being transferred to Travelodge.

John Hardy and Whitestone Land are the specialist consultants to the Company who have been tasked with securing these projects throughout the UK by drawing together the various key consultants and personnel to deliver this aspect of the openings programme. All opportunities to the South of Birmingham should be directed to John and all potential projects from Birmingham northwards should be forwarded to Jeff and Nick at Whitestone Land.   Christie & Co continue to assist us in the drive for more openings outside of London and the downloadable brochure provides more detail of Christie & Co’s role, with their Jeremy Jones being the main contact.

Finally, the simple matrix below should be taken as a guide of Travelodge’s positioning on five key areas that we assess immediately in considering a potential Going Concern conversion. Whilst we encourage anyone with a potential opportunity to get in touch, this may help you in acquiring a basic understanding of what we are looking for...