Register to get 3 free articles
Register to unlock the article and receive our free newsletter. Join 26,000 other hotel leaders and stay in the know.
Want unlimited access? View Plans
Already have an account? Sign in
InterContinental Hotels Group (IHG) has received a binding offer from Constellation Hotels for its iconic InterContinental Paris – Le Grand.
The proposed purchase price is 330m euros (£262m), with Constellation making a further commitment to invest over time an estimated 60m euros (£47m) in future renovations for the 470-room property.
Under the terms of the proposed deal, IHG would retain a 30 year management contract on the hotel, with three 10-year extension rights at IHG’s discretion, giving an expected length of 60 years.
Management fees are expected to be approximately 4m euros (£3.2m) per year. In 2013, the hotel generated revenues $118 (£70m) and EBIT of $22m (£13m).
Richard Solomons, chief executive officer of IHG, said: “The InterContinental Paris – Le Grand is an exceptional property and is an iconic hotel in our portfolio.
“This announcement demonstrates the continued successful implementation of our asset-light strategy and strength of our relationship with constellation, following its recent purchase of InterContinental London Park Lane and its majority investment in InterContinental New York Barclay.”
