Japanese billionaire in for City hotel

By James Buckley - Wednesday, July 06, 2016 16:00

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Japan’s fourth richest man is negotiating to buy a luxury 80-bedroom hotel in the City of London which was put up for sale last October for £80m.

Akira Mori, the president and CEO of Mori Trust, a Tokyo-based property developer and an offshoot of Mori Building, is understood to have agreed terms to buy the South Place Hotel at 3-4 South Place for closer to £70m.

Mori, whose personal net worth is estimated at around $5bn, headed Mori Trust, while his brother headed Mori Building until his death in 2012. Mori Trust owns and operates a 67-property portfolio of office and resi buildings, mainly in central Tokyo and other major Japanese cities.

Frogmore brought the hotel to market last October in what is one of the final assets in its Frogmore Real Estate Partners (FREP1) fund.

The quoting price for the hotel, which is operated by London restaurants group D&D as its first hotel, reflected a yield of circa 4%.

Frogmore lodged plans in 2009 to convert the site where it had originally planned an office scheme named The Chandelier to a 72,000 sq ft boutique hotel designed by architect Allies & Morrison after it signed D&D London to lease the hotel on a 35-year term.

D&D London was formerly known as Conran Restaurants. The interior of the hotel was designed by Conran & Partners.

The hotel behind Finsbury Circus includes Michelin starred restaurant The Angler, bars and private dining facilities.

Following practical completion and the opening of the hotel in September 2012, Gerard Nolan Asset Management was instructed to asset manage South Place Hotel, working with D&D London to increase value and continually grow revenue.

FREP II closed on 14 December 2009 having raised around £195m of equity and is fully invested. FREP III closed on 9 June 2015 having raised £392m of equity.

CBRE, JLL and Gerard Nolan & Partners advise Frogmore.

All parties declined to comment.

pnorman@costar.co.uk

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