Barclay brothers buy Claridge’s in £700m Irish property debt fire sale

Trio of five-star London hotels sold to owners of Daily Telegraph by Nama after property crash hits Dublin syndicate Three of London’s top hotels, including Claridge’s, have been sold to the Barclay brothers, owners of the Daily Telegraph, by the Irish state agency trying to recover billions of euros of bad property debt. The Channel Isles-based brothers acquired Maybourne Group, which also owns the Connaught and Berkeley hotels, by buying £700m of loans originally taken out by a syndicate of Irish property developers. The deal reinforces David and Frederick Barclay’s position as the owners of some of Britain’s finest hotels. The brothers already own the Ritz in Piccadilly, central London. It is the largest property sale by the Irish National Asset Management Agency (Nama) since it was set up to deal with the debt amassed by developers during the property boom. The five-star hotels had been bought by a syndicate that included Derek Quinlan, a former tax inspector, and Paddy McKillen in 2005 in one of the most audacious deals by Irish entrepreneurs riding on a wave of cheap credit. The syndicate was then hit by Ireland’s property crash. The agency said on Thursday it has recovered every penny of debt from the Claridge’s deal. “The loans were sold for in excess of €800m with Nama recovering 100% of the original value of the loans plus interest,” it stated. The deal marks a succesful start to a fire sale by Nama of London property within its control, announced earlier this year, including the Citigroup tower in Canary Wharf, part of Leicester Square and the Louis Vuitton building in Bond Street. With Royal Bank of Scotland and Lloyds, Nama is one of the top property lenders in the UK with a loan book of €30bn (£26bn). With the Irish property market still in the doldrums, Nama is concentrating on the UK to get a return for the Irish taxpayer by 2013. It is hoping to cash in on the commercial property bubble in London which is seen as a safe haven by investors fleeing exceptionally volatile stock, bond and currency markets. Last month it published a list of 850 distressed properties up for sale both in Ireland and the UK – including pubs across Britain, a string of hotels including the Crowne Plaza in Shoreditch, London and, at the bottom end, a car park in Bangor in north Wales and an off licence in Muswell Hill, London. Quinlan and McKillen funded the purchase of the three landmark London hotels through loans from Allied Irish Banks and Anglo Irish Bank, both since nationalised. Quinlan has had a spectacular fall in Ireland’s property crash and has been trying to offload the Citigroup tower which he bought with property investor Glenn Maud. The 42-storey tower at 25 Canada Square was bought from Royal Bank of Scotland in 2007 for £1.1bn and Nama had been close to concluding a sale. It was withdrawn from the market last week after hitting a snag related to a recent legal ruling affecting rental payments. Speaking in Dublin on Thursday, chief executive Brendan McDonagh said loan sales would form a major part of Nama’s strategy. He was open to selling loans relating to “individual assets, whole debtor connections or groups of loans by geography.” The agency is choosing advisers in Europe and the US to assist in property sales. Nama has acquired approximately €600m in loans linked to assets in the US and €30bn of loans linked to assets in the UK and Europe. Ireland Commercial property Real estate London Hotels Barclay Brothers Europe Lisa O’Carroll guardian.co.uk

Posted by on September 29, 2011. Filed under News, Politics, World News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.