Redefine International buys Scotland hotel in post-referendum deal

This could be the first of a string of major Scottish incoming and outgoing business deals that have been waiting quietly in the wings for a NO vote in the Scottish referendum. It will be interesting to see what else emerges from corporate liaisons that may have been in place before the Scots decision to remain in the UK. GK

Redefine International PLC, the income-focused UK Real Estate Investment Trust, has announced the purchase of the 138-bedroom Doubletree by Hilton Hotel in Edinburgh's city centre for £25.27 million – which represents a net initial yield of about 6.9%.

The recently extensively refurbished 5-story hotel provides accommodation to both business travellers and tourists.

As Scotland's capital city and the UK's second largest financial centre after the City of London, Edinburgh is a key hub in the UK transport network and a thriving year round tourist destination.

The acquisition includes the separate heritable title of The Chanter public house, located on the ground and basement floors of the property.

The hotel will be let to Redefine Hotel Management Limited, a wholly owned subsidiary of Redefine BDL Hotel Group Limited, in which Redefine International has a 25.28% stake.

Initial funding of the acquisition – which will be housed in 71.05% held subsidiary Redefine Hotel Holdings – will be by way of existing cash resources held by Redefine International. It is anticipated that the Hotel will be Limited in due course.

Mike Watters, Chief Executive of Redefine International, said:

"The transaction was structured on a conditional basis subject to a no vote in the Scottish referendum. Now that the uncertainty surrounding this has been removed we are very pleased to have secured this opportunistic investment in the city of Edinburgh. It complements our existing hotel portfolio and plays well to the management skills of Redefine BDL."