Newcastle hotel group expands following £31.5m refinance

Hundreds of jobs have been created at a Newcastle hotel group following a £31.5 million refinance deal with HSBC.

Cairn Hotel Group has completed a refinance with HSBC’s Yorkshire and North East Corporate Centre which includes £6.5m of new finance to support a refurbishment programme of some of its portfolio and to fund new acquisitions.

In an agreement with InterContinental Hotels Group, Cairn is refurbishing four of their hotels, they will also adopt one of IHG’s brands but retain ownership and management of the property.

It is expected that over 200 jobs will be created over the four locations as a result of the refurbishment.

The Station Hotel in Aberdeen and The Bellhouse in Buckinghamshire will become Crowne Plazas, whilst the Chasley Hotel in Wakefield will become a Holiday Inn Express and The Royal British in Edinburgh will be a Hotel Indigo.

Cairn will also use the finance to invest in upgrades at its other properties as part of its programme of continuous improvement, and will continue to seek acquisition opportunities to expand its portfolio.

The refinance was arranged by HSBC’s Yorkshire and North East Corporate Centre after a competitive pitch in a deal led on behalf of the bank by Senior Corporate Banking Manager Andy Parker.

He was supported by Regional Deputy Head of Corporate Banking Mike Swift and Senior Corporate Banking Manager Tony Leech.

Mr Leech said: “The Cairn Hotel Group is a long-standing customer of HSBC so we are pleased that we have been able to support the company on this latest project.

“This refinance demonstrates that we are keen to work with expanding businesses that have strong management teams and clear strategies for growth.”

Cairn, which employs over 1,000 people across the UK, owns four hotels in Newcastle, including the Cairn Hotel Newcastle, Carlton, Rooms Inn and Royal Station, as well as hotels in London, York, Edinburgh,, Carlisle and Manchester.

It also owns and manages three Holiday Inns, including Newcastle, Birmingham and Darlington, a Best

Western in Aberdeen, a DoubleTree by Hilton near Newcastle Airport, a Hotel Indigo in London and the Mercure Kings Head Hotel in Darlington.

Finance Director Richard Warren said: “Our portfolio offers a broad range of hotels for a wide spectrum of customers, from the high end to travellers on a budget.

“However, some of our properties are better suited to a mainstream hotel brand as consumers are typically attracted to larger brands that they recognise and trust.

“That is why we have affiliated with IHG, which gives us a better path to market with some of our properties.

“We are undertaking refurbishment work at four of our properties to ensure they meet IHG’s requirements and we will be working with local tradespeople and businesses in these communities during this process.

“We will also be recruiting ambitious staff in these locations, boosting the local jobs market and economy.”

An IHG spokesperson said: “IHG is proud to work with the Cairn Hotel Group, which it sees as one of its major growth partners in the UK and it is keen to expand its relationship with the group on appropriate development opportunities.