Criterion Capital, owned by billionaire Asif Aziz has purchased Haymarket House in Soho for £135 million according to City AM.
Located in Piccadilly Circus, the building comprises a ‘Happy’ restaurant and comedy club on the ground floor and office space on the upper floors. Aziz plans to convert the office space into a hotel for £400 million, leaving the restaurant and comedy club on the ground floor serving the same purpose.
Why it matters
Office to hotel conversions have become a popular topic of discussion in recent years due to factors such as ESG concerns in relation to office buildings and the prohibitively high cost of ground up hotel development. This deal joins others which have moved on from discussion into action as tourism continues to boom post-pandemic, especially in cities such as London which attract high amounts of traveller interest.
Speaking with Hospitality Investor, Saar Sharon, head of hotel capital markets at Colliers says the trend for office to hotel conversions is expected to continue into 2024, noting strong interest in such conversions. “London and Edinburgh are attractive for office conversions and department stores conversions, the latter particularly in Edinburgh. We definitely see a trend in London for office conversions into hotels and strong interest in that.”
What they said
Asif Aziz said to City AM: “The office market is polarised. People want new buildings that are best in class. Most of the buildings in central London and the City that are vacant can never be best in class. So an alternative use has to be found in this case, a hotel because Haymarket House is in an area with the highest tourist footfall in Europe. It’s really the combination of a perfect location coupled with a building that basically has come to its end of its use as an office and isn’t particularly well suited to an office.”