Bullish Blackstone buys Village Hotels from KSL

LONDON – As has been rumored for weeks, private equity giant Blackstone has agreed to buy British hotel operator Village Hotels from KSL Capital Partners for an undisclosed price. Sky News previously reported that the chain was put up for sale with a valuation of around £850 million ($1.1 billion).

Village Hotels owns and operates 33 assets in large regional cities and suburban areas across the U.K. Representing 4,400 hotel keys, it operates as an “all under one roof” leisure destination, offering traditional full-service hotel stays, fitness clubs, food and beverage outlets, and co-working spaces.

Blackstone stated the move was part of a wider plan to move deeper into the hospitality space based on current market conditions and the sector’s performance versus other commercial real estate.

“We see great potential in lodging and leisure as a sector, especially where we can support strongly positioned businesses that deliver exceptional experiences to their customers,” said James Seppala, head of Real Estate Europe at Blackstone. “We look forward to partnering with Village Hotels’ seasoned management team and support them as it embarks on its next stage of growth.”

Gary Davis, CEO of Village Hotels, said each hotel attracts over 4,000 local members to its health and wellness clubs and with Blackstone’s investment he sees great opportunities to expand the number of hotels in the U.K. and further enhance existing facilities.

Blackstone has been active in the U.K. leisure sector. In 2021, it acquired Bourne Leisure, a U.K. holiday company and owner of Haven Holiday Parks, the largest caravan operator in the U.K., as well as Warner Hotels, the only hotel chain to cater exclusively to adults in the U.K. Since acquisition, the firm has invested over £550 million across both brands for site and entertainment upgrades and expansions.

Lazard acted as Blackstone’s lead financial advisor, Santander also acted as Blackstone’s financial advisor and Simpson Thacher & Bartlett and DLA Piper served as Blackstone’s legal advisors. Morgan Stanley & Co. International acted as KSL’s financial advisor and Dentons served as KSL’s legal advisor.