The option occurred after a CVA took place at Travelodge. Despite this, the budget hotel will continue to act under the same terms and conditions, with a short-term reduction in rent.
Under the agreement SIR is set to receive £19.8m in 2021, with rents reverted to the full contracted level in 2022.
Travelodge’s 123 sites represent 19.6% of the investor’s portfolio value, and the company continues to be “a market leading operator”.
Martin Moore, chairman of SIR, said: “We have carried out a thorough review of the options available to the Company (SIR) and are satisfied that Travelodge remains a market leading operator, albeit with ongoing capital constraints in the same challenging market facing all hotel businesses.
“We believe that provided sufficient capital is made available, Travelodge should benefit materially as the economy recovers.”