Oct 22, 2003

Claridges’ Owners Review Sale Potential

Blackstone, in conjunction with Colony Capital, has appointed Deutsche Bank and Jones Lang LaSalle as advisers to review the marketplace with a view to the potential sale of Claridge’s by the Savoy Group.

Over the past few months, the amount of interest expressed in Claridge’s from a variety of potential bidders has accelerated considerably. Furthermore, over £55 million has been invested in Claridge’s over the last several years, so the hotel is now fully modernised with respect to any structural, functional, or cosmetic modification and improvement work. Consequently, Blackstone and Colony Capital have decided it an opportune time to appoint advisers to undertake a full review of the potential interest and to evaluate offer levels in consideration of a sale.

The owners remain committed to the rest of the hotels within the Savoy Group and continues to work with the current hotel management on a range of modernisation and refurbishment programmes to improve each hotel’s offering and ultimate value. The Group has no plans for further disposals at this time.

John Kukral, President of Blackstone Real Estate Advisors, said:

“In the five years since we acquired the Savoy Group we have invested considerable time and money in consolidating Claridge’s position as one of the world’s leading luxury hotels. Throughout this time we have received a variety of levels of interest in the hotel, which until now we have not pursued.

“However, in recent months this interest has increased to the point that we feel it prudent to enter into a more formal process in terms of assessing both interest and offer levels. This ties into the fact that the Hotel is now complete in terms of any structural modernisation. In addition, the investor appetite for quality, freehold investments in the West End of London is very deep at this time. Accordingly, we have appointed Deutsche Bank and Jones Lang LaSalle to assist us in the process.

“I should stress that no firm decision has been taken at this stage and we will provide a further update once a full review has been completed.”