Goldman Sachs-backed Tifco checks into Travelodge in Ireland
Hotel assets have become one of the hot spots in commercial property in past 18 months
Two former Jurys Doyle executives, Seamus McGowan and Richard O’Sullivan, along with accountant Stan Cooney, took over Travelodge’s Irish portfolio in 2004
Goldman Sachs-backed Irish hotel group Tifco is poised to take over the company behind the Travelodge franchise in Ireland in a deal that will add 12 no-frills inns to its portfolio, according to industry sources.
The value of the deal is not immediately clear, though it would reflect the fact that a number of the properties, which span almost 780 rooms, are leased rather than owned outright, they said.
The deal would consolidate Tifco’s position as the State’s second largest hotel operator behind publicly-listed Dalata Hotel Group.
It will have to be approved by the Competition and Consumer Protection Commission.
Tifco owns seven hotels, including three Crowne Plazas, and manages a further seven, including the five-star Hermitage golf and spa resort in Co Laois. The group operates a total of 1,776 bedrooms.
In 2014, Goldman Sachs took a controlling stake in Tifco as part of a renegotiation of its bank facilities. A subsequent deal last year resulted in the US firm sharing ownership of Tifco with the company’s legacy owners, Aidan Crowe and Gerry Houlihan, the founder of DID Electrical. Mr Houlihan’s family owns Clontarf Castle, which is operated by Tifco.
Irish portfolioTwo former Jurys Doyle executives, Seamus McGowan and Richard O’Sullivan, along with accountant Stan Cooney, took over Travelodge’s Irish portfolio in 2004 in a €22.5 million deal. They set up a company called Smorgs (Ireland) to carry out the deal, which included eight hotels.
Mr McGowan, who was managing director of the business at the outset, stepped down as a director in April 2014, according to company filings.
Efforts to secure comment from executives at Tifco and Smorgs on Thursday were unsuccessful.
The most recent publicly-available set of accounts show that Smorgs made a €1 million loss for the year to March 2014 on €9.5 million of gross profits.
Hotel assets have emerged as one of the hot spots in the commercial property market in the past 18 months, following on from a wave of transactions in the office and retail sectors in recent years.
Revenue per available room in Dublin rose by 23 per cent last year, the highest of any European city, and had surged a further 21 per cent in the seven months to July, according to STR Global, a research firm that specialises in hotel statistics.