Qatar in talks to buy luxury London hotel group

Qatar Holding, the investment arm of Qatar's sovereign wealth fund, is in talks to increase its London portfolio with a $1.6bn bid to buy the hotel group behind The Connaught, The Berkeley and Claridge's, it has been reported.

Qatar Holding, which in May paid $2.5bn for London department store Harrods, is understood to be in early negotiations with the Maybourne Hotel Group.

Maybourne, which owns luxury hotel brands The Connaught, The Berkeley and Claridge's, is battling to refinance more than $1bn worth of debt.

Real estate adviser DTZ has been appointed to oversee the deal and negotiations are at an early stage, the Daily Mail reported.

Qatar’s growing wealth has seen it become the largest dealmaker in the Gulf, boasting a per capita income of $83,000.

The gas-rich state holds stakes in retail giant J Sainsbury, the London Stock Exchange and Barclays Bank, while its property portfolio includes assets such as London Bridge Tower, Chelsea Barracks and the US embassy building in Grosvenor Square, London.

Last month, Qatari Emir Hamad bin Khalifa Al Thani said he would be keen to buy London auction house Christie’s, as part of the emirate’s bid to become a cultural hub.

Maybourne was established in 2005 with funding from Anglo Irish Bank and Bank of Ireland. Both Irish lenders received state funds in the wake of the global downturn, and remain hamstrung by huge losses.

A key shareholder in the group, Irish real estate mogul Derek Quinlan, has sold a number of key assets following the demise of Ireland’s property market.

In June 2005, Quinlan was among a group of investors who sold luxury hotel The Savoy to Saudi Arabia’s Prince Alwaleed in a deal valued at £250m.

Maybourne has some 800 staff and assets worth nearly $7bn, including Four Seasons hotels in Dublin, Milan, Budapest and Prague.

Its London hotels feature a number of Michelin-starred restaurants operated by celebrity chef Gordon Ramsay.

The hotel group’s loans were included in those recently handed over to the National Asset Management Agency (NAMA), an agency set up by the Irish government to handle the toxic property assets of the country’s main banks.

Maybourne is reported to be in talks with Deutsche Bank and US private equity house Northwood Investors, in a bid to refinance $1bn worth of debt and avoid a firesale of its key assets.

Last month, Maybourne said the refinancing of the hotels’ debt was in the final stages and would be “resolved ahead of the December deadline.”

In a statement, the group denied reports that its hotel assets were for sale.