Update (May 3, 2018): IHG (InterContinental Hotels Group) has entered into a conditional agreement with Foncière des Régions (“FdR”), the new owner of the Principal Hotels and two Devere properties. IHG is to rebrand and operate these hotels which helps IHG to expand the presence for the luxury InterContinental brand, and enable to launch its boutique brand, Kimpton Hotels in the UK. Also, IHG will establish a new upscale brand, which will be launched later this year which principally will focus on conversion opportunities.
Turning some of the Principal properties into InterContinentals seems a good fit. The George Hotel in Edinburgh used to be an InterContinental! I wonder which hotel will be the Kimpton Hotel – maybe one of the hotels in Edinburgh or Glasgow – where Principal has two properties in each city? And curious to know what the new IHG brand will be, and what makes it different to Principal Hotels. There are lots of conversion opportunities in the UK, with many former luxury hotels needing upgrades – for example the faded gems in the Britannia Hotels portfolio or combine it with the QHotels Group.
Principal Hotels (previous Principal Haley Group) is a British hotel operator of “urban lifestyle” hotels and is owned by the American investment vehicle Starwood Capitol Group – not to be confused with the hotel operator now cobbled up by Marriott. This week it was announced that Starwood is in exclusive talks with Foncière des Régions (FdR), a French real instate investor who is also behind the German hotel/hostel hybride chain Meininger. FdR would bring in InterContinental Hotels Group (IHG) as manager for the hotels – which would mean another small, luxury brand added to the IHG stable.
Starwood Capital Group bought Principal Haley in February 2013 for £360 million from Lloyds Bank who itself in 2010 bought the then 6-strong property group following financial difficultly after a management buyout.
Now Principal operates 26 landmark hotels in the UK under the now Principal and De Vere brands (which Starwood bought in March 2014). Two of the De Vere properties are also included in the Starwood-FdR deal. Many of the hotels where once owned by famous predecessors such as British Transport Hotels, Forte Hotels and Grand Metropolitan – all brands which have disappeared from the market.
Kimpton Fitzroy London, formerly the Hotel Russell and a brief stint as The Principal London, is the latest to the portfolio’s renovated properties and will open on April 16th after an extensive £85 million refurb. The property is a Grade II* listed building designed by Charles Fitzroy Doll in 1898 occupying the eastern flank of Russell Square in Bloomsbury. The hotel features a number of updated dining and entertaining options, including The Palm Court which has been designed as a “living room” for Londoners and hotel guests. Burr & Co., a coffeehouse, will be open for breakfast and throughout the day, whilst Fitz’s bar (main picture) will offer evening drinks.
In Birmingham, Principal is to operate the Grand Hotel under its banner. Already in 2013 there were plans to revive the derelict, once grand hotel. Both Principal and the Grand Birmingham websites reveal very little information when the planned 180 room is to (re)open.
The Principal York, built as the Royal Station Hotel in in Grand Victorian style is in my opinion one of Principal’s most beautiful hotels. Outside it is all sandy-coloured bricks and drainpipes. Inside a classic contemporary decor of Corinthian pillars, lofty corridors, soft grey, soft carpets, walls hung with mirrors, elegant velvet armchairs and Chesterfield sofas.
Principal also has grand classic hotels in Edinburgh (2), Glasgow (2), Manchester and Leeds. In Liverpool, the iconic interwar Martins Bank headquarters is also turned into a Principal. The modern (2000) St. David’s Hotel in Cardiff is also part of the portfolio and so is the Oxford Spire Hotel – a rather dull looking hotel, and not fitting into the portfolio. Maybe because the hotel was a part of the Four Pillars chain, acquired by Starwood in 2014.