UK: The “compact luxury” brand Z Hotels has secured a £15 million loan from OakNorth Bank to refinance an existing loan and construct new rooms at its Piccadilly property.
The additional 20 rooms at Z Piccadilly will increase the hotel’s total room count to 132. The funding will also be used to develop new lift facilities and a new ground floor café.
Z Hotels has been an OakNorth customer for several years, initially securing funding in 2018 to support its expansion of new sites across central London in Covent Garden, Holborn, and Tottenham Court Road.
Today, Z Hotels operates 14 sites throughout London, Bath, and Glasgow, offering 1,710 bedrooms.
Bev King, CEO at Z Hotels, said: “Since our launch 12 years ago, the focus of our brand has continued to be very simple – offer consumers a chain of hotels that are positioned in central locations, with reasonable room rates, that come with modern and stylish designs and high-quality features throughout.
“OakNorth has now supported us on multiple transactions, and we see them as our trusted funding partner that has worked closely with us through the challenging times of both the pandemic and the current cost-of-living crisis. With this latest facility from OakNorth, we are moving to work closer with its team and look forward to further growing the Z Hotels brand across the UK, whilst also expanding our site at Piccadilly.”
Deepesh Thakrar, senior director of debt finance at OakNorth, said: “Z Hotels’ unique proposition has enabled it to build a broad and diverse portfolio in a relatively short space of time and achieve incredibly high occupancy consistently throughout the year.
“Their focus on high-quality rooms and a premium visitor experience is demonstrated through its 99 per cent room-led revenue, five-star reviews, and an average occupancy across all its hotels of 96 per cent.
“Further to this, Z Hotels’ resilience to the covid pandemic has been exceptional, with the business now exceeding pre-covid trading levels. We’re thrilled to once again have the opportunity to support a best-in-class team and look forward to working with them again in the future.”