- Founded by Bev King, Z Hotels launched its ‘compact luxury’ accommodation model in London with the opening of Z Soho in 2011;
- Since then, the hotel chain has experienced continued success with 14 sites now operational across London, Liverpool, Bath, and Glasgow;
- The £23m co-loan will be used to acquire and refurbish a five-story vacant office building adjacent to Leicester Square and convert it into Z Hotels’ new 85-room hotel;
- This transaction follows OakNorth’s previous funding to the group in June to refinance an existing loan and fund the construction of an additional 20 rooms at its Piccadilly location.
Founded by Bev King, Z Hotels launched its ‘compact luxury’ accommodation model in London with the opening of Z Soho in 2011. Since then, the hotel chain has experienced continued success with 14 sites now operational, including 11 in London and one each in Liverpool, Bath, and Glasgow, offering over 1,700 rooms. The group has been a long-standing customer of both OakNorth and ASK, most recently securing a loan with OakNorth in June this year to refinance an existing loan, as well as fund the construction of an additional 20 rooms at its Piccadilly location. ASK also provided funding for the group’s Trafalgar Square hotel.
The latest facility announced today marks the inaugural co-loan from OakNorth and ASK Partners to Z Hotels and will be used to acquire and refurbish a mixed-use building, consisting of a ground and basement floor with restaurant/retail use and four storeys of office use accommodation above ground floor, plus a fifth-floor attic. The building, located along Charing Cross Road and a short walk from both Leicester Square and Trafalgar Square, will be converted into Z Hotels’ latest offering and, subject to planning, is expected to have a minimum of 81 rooms and a maximum of 95 rooms. The site is very centrally located and within walking distance of many of London’s main tourist attractions.
Commenting on the deal, Bev King, CEO at Z Hotels, said: “Our guests predominantly want to spend a couple of nights in a city centre location either for business or pleasure, to explore the city, and to sleep in generously designed surroundings. This new site situated on Leicester Square’s doorstep embodies this demand perfectly, providing our residents with compact but well-designed bedrooms at affordable prices. Our relationship with OakNorth and ASK now spans multiple transactions and we see them both as key funding partners who we know we can rely on to support our ambitious growth targets.”
Deepesh Thakrar, Senior Director, Debt Finance at OakNorth, commented: “Z Hotels is now one of our longest standing customers and we’re delighted every time we have the opportunity to support its best-in-class team. The group is an incredibly experienced hotel operator that continues to focus on delivering high-quality rooms and a premium visitor experience, that’s demonstrated through its average occupancy rate of 96% across all its hotels. Given London’s hotel market is set to show strong resilience against the current downturn, we fully expect this new hotel to be another success story for Z Hotels.”
Daniel Austin, CEO and Co-founder of ASK added: “It is always a pleasure to work with our partner OakNorth and Z Hotels. This is an exceptionally well-located site which fits Z Hotels’ target market perfectly, capitalising on the growth we’re seeing in single business travellers during the week and short stay tourists at weekends. Given Z Hotels’ track record as a successful owner operator of five other hotels within close proximity of this site all with high year-round occupancy levels, ASK was fully supportive of the project and happy to provide a 36-month loan to acquire this building, which I anticipate will be another well-designed and popular hotel for the group.”
Notes to editors
Launched in September 2015 and founded by entrepreneurs, OakNorth provides fast, flexible, and accessible debt finance to the UK’s Missing Middle.
Since its launch, the bank has:
- Lent over £10b, directly helping with the creation of 40,000 new jobs and 29,000 new homes across the UK.
- Raised deposits from c.175,000 savers.
- Supported several hundred businesses across the UK with the debt finance to pursue their growth ambitions.
It is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Visit www.oaknorth.co.uk for more information.
About ASK Partners
ASK is a specialist, independent property lender, established by an experienced team of three partners in 2016 to provide bespoke and flexible real estate finance solutions. Building a team to complement their own unique blend of skills, they have now lent in excess of £1.3bn across over 110 transactions without default. Every transaction is underwritten by ASK and the company has earned a reputation as a trustworthy partner. In October 2022 ASK announced the sale of a 50% stake to OakNorth Bank, a move which has provided a significant platform for growth.
Voted by its clients and the industry, ASK won Real Estate Capital’s European Small Ticket Lender of the Year 2021 and 2022, and Mid-Market Deal of the Year 2022.
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