Qatar buys London’s Grosvenor House Hotel in spite of sanctions
Grosvenor House Hotel in London was bought by Qatar
With an influx of energy revenue currently boosting Qatar’s buying power, the Qatar Investment Authority has purchased the Grosvenor House Hotel in London, according to a recent report from the global news service Reuters.
A source has told Reuters that a private United States real estate investment firm, Ashkenazy Acquisition Corp., has actually agreed to sell the hotel for an undisclosed amount of money. The sale is being made to the state-run Qatar Investment Authority through its Katara Hospitality Unit.
As Reuters noted in its report, this is becoming somewhat of a pattern for the nation. Qatar has been buying top hotel properties in western locations over the past decade as part of a drive by its $300-billion sovereign wealth fund to diversify the wealth it accumulates from gas and oil exports. It has a total investment of over £30 billion in the UK and is looking to expand this by £5 billion in the next few years. The 13-year-old QIA, funded by the country’s gas exports, already owns London’s Savoy and Connaught hotels, and acquired The Plaza Hotel in New York City for around $600 million in July.
Ashkenazy Acquisition originally acquired the Grosvenor House Hotel from India’s Sahara Group last year, also for an undisclosed price. The property was first constructed in the 1920s and it initially opened in 1929. It was noteworthy because of its status as a luxury hotel that was located near the desirable area of Hyde Park, Oxford Street and Buckingham Palace. All of which are regularly in strong demand for tourists, and remain so in the modern day, helping to power the United Kingdom as one of the most popular tourism markets in all of Europe. The eight-story JW Marriott hotel has 420 guestrooms and 76 suites as well as 64,110 square feet of meeting space across 26 rooms.
The acquisition brings Katara Hospitality’s portfolio of properties in operation or under development to 40.
There are, of course, insights to be gleaned from these reports for those who are in the hospitality market. The reported purchase of an upmarket London hotel by Qatar suggests that the state’s $300 billion national wealth fund is shifting its investment focus, which is big news for any hospitality management company or investor with any sort of interest that’s even remotely affected by the market in the Middle East.
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