EXCEPTIONAL REBRANDING RAMADA MAILBOX BIRMINGHAM OPPORTUNITY INVESTMENT HIGHLIGHTS • Rare opportunity to acquire a 90 bedroom city centre hotel and add significant value by rebranding and repositioning the asset in a flourishing market • Prime location within the renowned Mailbox mixed-use development scheme, in the vibrant city centre of Birmingham • The Birmingham hotel market is going through a significant period of revival having absorbed the new supply of recent years and now benefiting from increased demand from both corporate and leisure tourism • Purpose built hotel, opened in 2001, with generously proportioned guest rooms and public areas • Full range of amenities and services including The Lounge Restaurant & Bar, Starbucks coffee shop and 3 meeting and events rooms • The Hotel is available free of management and is currently operated under a franchise agreement from Wyndham Hotels & Resorts under their Ramada brand, with the ability to terminate the agreement upon 30 days’ notice • Exciting opportunity to reposition the property under your chosen brand and realise significant performance growth in Occupancy, ADR and EBITDA • Rebranding opportunities include international hotel brands such as Four Points by Sheraton and DoubleTree by Hilton 3 Location The Hotel is situated within The Mailbox, a landmark mixed use development comprising a range of luxury shops, bars, restaurants and salons. The development, which was initially completed in 1997, is currently undergoing a major refurbishment and upward repositioning at a total cost of approximately £50m. As part of the refurbishment, which will include a new roof, larger public areas and improvements to the surrounding infrastructure, the anchor store, Harvey Nichols will double in size to over 45,000 sq. ft. A boutique cinema by Everyman is due to open adjacent to the hotel entrance in 2015. The Ramada Mailbox Birmingham City Centre is surrounded by the city’s most popular attractions, making it an ideal base for leisure and convention tourists. Situated next door to the hotel is The Cube, an iconic 25 storey mixed use development completed in 2010. Ten minutes’ walk to the north of the hotel lies Brindley Place, home to the ICC, Barclaycard Arena and National Sea Life Centre. 7 minutes’ walk to the south, guests can reach the O2 Academy Birmingham and the Birmingham Hippodrome. In terms of accessibility, the hotel is unrivalled with Birmingham New Street Station, located 5 minutes’ walk from the hotel, providing Virgin Trains services to London Euston in 1 hour 25 minutes and Edinburgh Waverley in 4 hours. Birmingham New Street Station is currently undergoing a £550m redevelopment named Gateway Plus, including a new concourse, exterior façade and entrance on Stephenson Street, due to complete in September 2015. The A38, running adjacent to The Mailbox, provides quick access out of the city centre and onto the M6, M42 and M40. TRAVEL TIMES BIRMINGHAM NEW STREET STATION 5 MINS THE ICC 6 MINS O2 ACADEMY BIRMINGHAM 7 MINS BIRMINGHAM HIPPODROME 9 MINS NATIONAL SEA LIFE CENTRE 9 MINS BARCLAYCARD ARENA 11 MINS BULLRING SHOPPING CENTRE 11 MINS NEC BIRMINGHAM 30 MINS BIRMINGHAM INTERNATIONAL AIRPORT 30 MINS 5 BIRMINGHAM Birmingham City Centre has experienced significant regeneration in the past 15 years with the construction of new squares, the restoration of old streets, buildings and canals, the removal of the BIRMINGHAM EVENTS CALENDAR 2015 MONTH VENUE pedestrian subways, and the demolition and subsequent redevelopment of the Bullring shopping THE NATIONAL WEDDING SHOW FEBRUARY NEC centre. CRUFTS DOG SHOW MARCH NEC The largest city in Britain outside of London, with over 1 million residents, Birmingham is today a thriving commercial centre, renowned for financial services, retail, events and exhibitions. The LIONEL RICHIE MARCH BARCLAYCARD ARENA regeneration of the city continues at pace with landmark projects such as the redevelopment of Birmingham New Street Station and Paradise Circus underway. BETWAY PREMIER LEAGUE DARTS APRIL BARCLAYCARD ARENA Major infrastructure projects such as High Speed 2 and the extension of the runway at Birmingham PAUL SIMON & STING APRIL GENTING ARENA airport are paving the way for Birmingham to further compete with London as the UK’s primary TAKE THAT MAY GENTING ARENA business centre, distributing economic supremacy across the country. HS2, which will connect Birmingham to London in 49 minutes, is due to become operational in 2026, whilst the extension COMMERCIAL FINANCE EXPO JUNE NEC of the runway which completed in July 2014 could allow for an increase in capacity from around 9 million to 33 million passengers by 2030. RUGBY WORLD CUP GROUP MATCHES SEPTEMBER VILLA PARK The city’s booming events and exhibition business is driven predominantly by the NEC group, THE CYCLE SHOW SEPTEMBER NEC which together attract over 4 million visitors a year, equating to 42% of the UK’s total conference and exhibition trade, outside of London. The NEC group comprises the NEC, ICC, Genting Arena ONE DIRECTION OCTOBER BARCLAYCARD ARENA and Barclaycard Arena, two of which are within 11 minutes’ walk of the hotel. 7 THE Property Opened in 2001, the Ramada Mailbox Birmingham City Centre is a purpose built red brick hotel laid out over six stories situated at the western end of The Mailbox development. Housed within the same building are thriving upmarket restaurants and bars with views over the Birmingham Canal. The 90 generously proportioned guest rooms are uniform in size and shape, allowing for excellent rebranding flexibility. Measuring between 20 – 23.3 sq. m, they are located on the first to fourth floors. All rooms in the hotel benefit from en suites and walk-in showers, whilst the north facing guest rooms on the third and fourth floors enjoy views over the picturesque canal. The Lounge Restaurant & Bar, located on the ground floor along with the Starbucks coffee shop (operated under licence), open onto the lively canal frontage and provide a relaxed atmosphere for guests to escape from the activity of the local area. The Hotel’s meeting and conference facilities, located at basement level together with a spacious breakout area, can accommodate a range of functions from conferences to intimate board meetings. BEDROOMS Type NO. OF BEDROOMS AVERAGE SIZE (SQ. M.) TWIN 31 21.7 DOUBLE 10 22.7 FAMILY 28 23.1 EXECUTIVE 20 21.6 DOUBLE ACCESSIBLE 1 23.3 Total 90 22.2 Food & BEVERAGE Facilities AMENITY NO. OF COVERS SIZE (SQ. M.) THE LOUNGE RESTAURANT & BAR 66 112.5 STARBUCKS COFFEE SHOP 25 64 MEETING & CONFERENCE Facilities NAME CAPACITY* SIZE (SQ. M.) ROLAND HILL 40 37 TUPENNY BLUE 30 33 PENNY BLACK 20 23 Total 90 93 * Theatre Style 9 TENURE BIRMINGHAM Hotel Operating The property is held by way of a long leasehold commencing on 14th December 1999 and expiring on 31st December 2130 (115 years remaining), at an annual rent of one peppercorn. MARKET The tenant covenants to pay the landlord a yearly service charge to cover services provided by Birmingham is a leading tourist destination in the UK for both corporate and leisure The Mailbox management team, including refuse collection, 24 hour security, external lighting and travellers with a range of unique attractions, the most popular events and exhibitions maintenance of the car park. centres in the country and a burgeoning business market. Statistics from Global Tourism Solutions show that Birmingham attracted a record number of visitors in 2013, reaching 34 million for the first time in history. The STEAM Operating Structure report for 2013 also showed a significant increase in the tourism economy with visitor There is currently a franchise agreement in place with Wyndham Hotels & Resorts, under their Ramada spending hitting £5.3bn, up £60 million on 2012. brand, expiring in June 2015. This agreement can be terminated earlier upon 30 days notice. 2014 is expected to show further growth in tourism numbers as the impact of the The Franchise Agreement is available in the virtual data room. recent infrastructure developments, significant investment in marketing and recovery in the UK economy take effect. This increased tourism activity has flowed directly through to hotel performance, with the Birmingham upscale hotel market experiencing an exceptional year of trading. RevPAR for the YTD November 2014 is up 6.3% on the same period last year, driven by both occupancy (1.7%) and ADR (4.5%). Growth prospects for 2015 are again excellent, with relatively limited supply in the pipeline (560 bedrooms due to open) and demand growth from the improving economy, Rugby World Cup and £10bn of public infrastructure investment, expected to drive similar RevPAR growth to 2014. PwC have predicted RevPAR in the UK provinces to grow by 6% in 2015. Given the points above and Birmingham’s status as an established tourist destination we would expect the city to track or outperform the wider UK market. BIRMINGHAM UPSCALE TRADING PERFORMANCE 100 76% 90 74% 80 72% 70 60 70% 50 68% 40 66% 30 OCCUPANCY (%) 64% VERAGE DAILY RATE (£) A 20 10 62% 0 60% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 YTD YTD Nov Nov ADR (£) RevPAR (£) Occupancy (%) 2013 2014 Source: STR Global 11 THE Opportunity REPOSITIONING & REBRANDING The Ramada Mailbox Birmingham City Centre currently competes in the Birmingham midscale market. Given Room Facilities Management Limited, an FF&E and OS&E Procurement and Management specialists, its excellent location and generously proportioned guest rooms and common areas, there exists an outstanding have carried out an in-depth cost analysis for the refurbishment of the Ramada Mailbox Birmingham opportunity to reposition and rebrand the hotel in the upscale segment and capitalise upon the improving UK City Centre to an upscale four star product. economy and increasing consumer confidence. Below is a summary of the detailed budget carried out for a conversion to a Four Points by Sheraton: The Hotel has been under invested for several years which has restricted the management teams’ ability to drive the business forwards.