Edinburgh hotel expected to be sold as pandemic throws up a 'number of repurposing opportunities' for housing
The pandemic has “thrown up a number of repurposing opportunities” according to a local estate agency following the news that a Travelodge in Edinburgh City Centre is expected to be sold after being deemed as “unsustainable”.
A Travelodge on Learmonth Terrace in Edinburgh – owned by Mansfield District Council – is expected to be sold by the authority after the site became “unsustainable” for the hotelier following the impact of the coronavirus pandemic.
The authority bought the land in March 2014 as an investment before opening a 35-year lease with the hotel provider.
However, documents due to be reviewed this week state the hotelier has conducted a review into its current leases following the Covid-19 pandemic and found the lease in Edinburgh to be no longer suitable for its business model.
Travelodge was contacted for a comment.
Discussing the possibility of a trend emerging in the Capital of hotels being repurposed, Steven Fyfe, Associate Director in the Hotel Capital Markets team at Savills Glasgow, said: “The disruption from the pandemic and accelerated property cycle has thrown up a number of re-purposing opportunities across various use classes.
"On Princes Street, we’ve witnessed vacant department stores converted to tourist attractions and hotels. We’ve also seen a number of vacant offices converting to hotel use.”
He added that on the other hand – and on a case by case basis – existing hotels may have a higher underlying use as “residential or another lodging use; coliving, BTR, extended stay.”
He also said that the adaptability of the property in question depends on things such as the “micro location, configuration and construction type”.
Mr Fyfe continued: “As more of the mechanisms that have been in place to support hotel operators are being wound down, developers, operators and investors may consider these alternative uses, with the resilient residential market a natural route to explore.
"However, we are also confident from recent sale processes in the city centre, that the maturity of the UK’s hotel market coupled with strong underlying fundamentals bodes well for a strong return to investment activity once travel movements increase, but the scaling back of support schemes will cause some disruption in the year ahead.”
The City of Edinburgh Council was contacted and declined to comment on the expected sale of the Learmonth Terrace Travelodge.