Quinlan nears €1.5bn Marriott deal

Quinlan Private, the property group headed by former tax inspector Derek Quinlan, is in advanced talks with two Israeli partners to purchase 47 Marriott-branded hotels in Britain in a deal valued at €1.5 billion.

One-fifth of Quinlan's assets are already hotels, but the latest deal is one of the largest in that sector for the company that, in 2004, bought the Savoy Group of hotels for £750 million (€1.1 billion).

The deal translates into 8,456 rooms spread over properties across Britain. The hotels are a mix of four and five-star, a significant number of which are in the London area.

It will be one of the most significant hotel property deals by Irish investors.

By comparison, the Jurys Doyle hotel chain transaction involved a total of 35 properties.

The hotels are currently owned by Royal Bank of Scotland, which purchased them in April from Marriott and the hotel and restaurant group Whitbread.

Since then, Marriott has been acting solely as manager of the properties

A spokesman for Quinlan Private yesterday said it was not prepared to comment. The deal is expected to be concluded shortly.

Quinlan's two partners in the deal are Israeli group Delek Real Estate, one of the largest property holding companies in the country and Egal Ahouvi, an Israeli lawyer who purchases properties on behalf of pension funds.

The only one of the three parties to make a public statement was Delek Real Estate, which told the Tel Aviv stock exchange yesterday that it had an interest of up to 19 per cent of the deal. It is not clear how the rest is split between Quinlan and Mr Ahouvi.

"The Marriott deal adds to the deal we did at the end of 2005, buying the Hilton hotel chain in Britain," said Ilik Rozansky, chief executive of Delek Real Estate, in a statement. The company currently holds 63 leading-brand hotels in Britain, Mr Rozansky said.

"We see great potential in British tourism, in light of the country's strong economy and the expected accelerated growth there before the 2012 Olympic Games in London." He added that Delek Real Estate intended to continue to invest in the European hotel industry.

Quinlan's activities in recent months have mainly focused on shopping centre investments. In September, a group led by Quinlan Private bought the Neumarkt Galerie shopping centre in Cologne, Germany for €170 million. In May, a group led by Quinlan bought the Diagonal Mar shopping centre in Barcelona for €300 million. The previous month, a group again led by Quinlan sold the Four Seasons hotel in Milan for €200 million.

Quinlan's long-term plans for the Marriott hotels are not clear. In May 2004, the company acquired the Savoy Hotel but decided to sell it less than a year later for £230 million.