£16m deal agreed for Liverpool’s biggest aparthotel

Entrepreneur bank OakNorth has completed a £16m debt finance deal for the conversion of a Liverpool office building into a hotel.

The Mason Family, real estate investors and developers in Liverpool and the North West, will use the eight-figure boost to transform seven of the Corn Exchange Building’s 11 floors into a 202-bedroom aparthotel.

The building has been owned by the Masons for 17 years and is where the family’s business, Mason Partners LLP, is headquartered.

The development is pre-let on a 35-year lease to aparthotel operator Staycity, which already owns 1,400 units but plans to grow that figure to 10k by 2021.

Founded in 2004, Staycity now operates across a number of large cities in the UK and Europe, including Manchester, Liverpool, London, York, Birmingham, Paris, Dublin and Edinburgh, with further sites opening in Marseille and Lyon in 2017.

In addition to the standard Staycity facilities, which include 24-hour reception, Wi-Fi access and weekly housekeeping, the Corn Exchange venue will comprise a fitness room, car parking, guest laundry, luggage lockers and an open-plan seating area.

Andrew Mason, Mason Partners LLP director, commented: “We’re delighted to have pre-let the property to Staycity – once completed, this will be the largest aparthotel development in Liverpool.

“Last year, the sector experienced a new average high in the city with occupancy levels averaging 78 per cent over the course of the year, reaching a peak of 90% in Q3.”

He continued: “The team at OakNorth worked tirelessly to complete the deal in just a few weeks, and the speed at which they responded to questions and queries was pretty remarkable.

“They have a great understanding of the sector and in the 14 months since they launched, have done a number of high-profile property deals across the UK.”

The co-founder and chief exec of OakNorth Bank, Rishi Khosla, said of the deal: “Since launching in September 2015, OakNorth has lent to a number of developers for projects ranging from hotel acquisitions and co-living developments, to strategic acquisitions of Prime Central London properties, and serviced apartments or aparthotels.

“With over 40 years’ experience of investing in and developing real estate in and around Liverpool, the Mason family has a firm grasp of how the city is set to evolve over the next few years, so it’s no surprise that they’ve been able to pre-let the property before development’s even gotten underway.”

He added: “With a portfolio of c.£100m and ambitious plans to continue growing, we look forward to working with this established family business in the future.”