Westin Hotel could fetch over €50 million
Receiver to put hotel formerly owned by Treasury on market
The hotel has 163 bedrooms, a basement bar and restaurant, a second restaurant at street level and a coffee shop upstairs. photograph: cyril byrne
One of Dublin’s landmark hotels, the Westin on Westmoreland Street, is expected to sell for more than €50 million when it is offered for sale in the coming weeks on the instructions of Nama.
Receivers PricewaterhouseCoopers are due to appoint selling agents shortly to handle the disposal of the four-star hotel which was held as an investment by the now defunct Treasury Holdings for almost 15 years. Treasury was wound up in 2011 with debts of €2.7 billion.
Like most of the other top hotels sold over the past 18 months, the Westin looks certain to be acquired by one of the large number of foreign buyers who have been chasing investment opportunities in Dublin since the property market collapsed.
It is one of the best located hotels in the city, occupying about 80 per cent of an entire block overlooking Trinity College and originally owned by Allied Irish Banks.
Some experts in the hotel market say the hotel may be over-rented at €4 million a year to Westin Starwood Hotels under a lease which has just under 15 years to run.
The rent is subject to five yearly upwards only reviews. A further rent estimated at around €600,000 comes from AIB which operates a bank branch from part of the former Scottish Widows building at the corner of Westmoreland Street and College Street.
The hotel facilities include 163 bedrooms, a basement bar and restaurant, a second restaurant at street level and a coffee shop on the first floor.
Analysts will undoubtedly study recent hotel sales in the city before attempting to put a realistic value on the Westin.
Kennedy Wilson’s decision to pay €110 million for IBRC and Bank of Ireland loans tied to the Shelbourne Hotel would appear to put a valuation of just over €400,000 on each of the 265 bedrooms. And the recent sale of the Clarion Hotel in the IFSC for €33 million works out at €200,000 per key.
A valuation of even €300,000 for each of the 163 bedrooms in the Westin – given the better location, the availability of an impressive banking hall for receptions and the fact that AIB is paying a formidable rent of about €600,000 per year for their bank premises – equates to almost €49 million.
The recent pick up in values in central Dublin and the intense shortage of high-quality investments may well push the bidding for the Westin to between €50 million and €60 million.
No fewer than 33 hotels sold last year in mainly provincial locations, realising €160 million. In 2012, 24 hotels changed hands for €146 million.