IRISH HOTEL operator Prem Group and Goodbody Stock- brokers have paid €27 million for an office block in central Brussels that they plan to turn into a four-star hotel.
The two groups have used their joint venture, the European Hotel Consortium (EHC), to complete the deal. This brings to 14 the number of hotels owned or managed by the fund, which has spent €122 million to date on deals.
EHC recently submitted a planning application to redevelop the office block at Rue de Marais in Brussels and hopes to open the property in July 2010. It will operate under Prem’s Leopold Hotels brand.
“Brussels is one of the few cities in the world holding up in the hotel business at the moment,” Jim Murphy, Prem Group’s managing director, told The Irish Times. “It has a good anchor tenant in the European Union and it’s also starting to become a weekend and city destination.”
Average occupancy rates at hotels in Brussels increased 3.3 points to 20.8 per cent in 2008.
Prem Group and Goodbody teamed up in 2007 to launch the hotel fund. They raised €45 million from investors, which has been supplemented by debt to develop a chain of 12 four-star hotels in Belgium and one in Calais, France.
Commenting on its hotel chain in Belgium, Mr Murphy said: “Our sales are down about 3-4 per cent but we’re pretty much holding our own. It’s not too dramatic and because of our scale we’re able to manage our costs better.”
EHC plans to expand the chain to Poland, Germany and The Netherlands in the near future.
Prem Group operates 37 hotels in Ireland, England and northern Europe, employing 1,400 staff. Its 2008 turnover is estimated to hit €76 million, up from €60 million in the previous year.
