OakNorth enables Z Hotels to develop a new 123-bedroom hotel in Trafalgar Square

George Sell By George Sell
10 December 2018 | Updated 12 December 2018

UK: OakNorth has completed a transaction with Z Hotels, one of the UK’s top hotel operators, to develop a new hotel in Trafalgar Square.

Launched in 2011, Z Hotels has established an excellent track record in developing and running hotels across the UK. The business has experienced rapid growth in the last few years owning and operating 11 hotels with two more in the pipeline. The OakNorth loan will be used to acquire office space at 53-59 Chandos Place and convert it into a 123-bedroom hotel (Z Trafalgar Square) which will open in Q4 2019. The hotel will have a café available to hotel guests and will be located right by several tourism hotspots. These include Leicester Square, Trafalgar Square, the National Gallery, Covent Garden, the West End, and the Strand.

Jonathan Raymond, Director at Z Hotels, said: "Over the years, our customer base has continued to grow and we now have hundreds of clients who stay with us several times throughout the year. Business travellers and holiday makers alike are attracted by our competitive prices, sizeable rooms and central locations - this new hotel in Trafalgar Square will be a prime example of all three. We chose OakNorth for this transaction as we knew they'd be able to deliver what we need in the time frame we needed it. With further growth targeted over the next few years, we expect to be working with the OakNorth team again in the future."

OakNorth Holdings was founded by Rishi Khosla and Joel Perlman, themselves entrepreneurs who were inspired to launch the business following the challenges they faced in securing debt finance from high street banks for their previous business, Copal Amba. They have since secured $576m ($455m primary) from several investors, including GIC, Clermont Group, Coltrane, NIBC, EDBI of Singapore, Toscafund, and Indiabulls.

Deepesh Thakrar, Senior Director, Debt Finance at OakNorth, said: "UK hotels have enjoyed record trading this year, underpinned by the increase in overseas leisure travel, two royal weddings, and the value of the pound being at its lowest rate against the dollar in three decades. Z Hotels with its convenient and incredibly central locations, affordable prices, and high quality, has been in a prime position to take advantage of this boom. The group achieves much higher occupancy rates and margins than its peers and has proven that it can maintain this across an increasingly expanding portfolio. We're delighted to have supported them with the finance to develop their Trafalgar Square site and look forward to working with them in the future." 

OakNorth provides fast, flexible and accessible debt finance (from £500k to £40m) to fast-growth businesses and established property developers / investors.

Since its launch, the bank has grown its loan book to £2bn, raised deposits from 30,000 savers, won numerous awards and been listed on the Leap 100, Tech City UK's Future Fifty, and Fintech City's Fintech50.

It is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. 

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