Quintain Estates and Development has created a joint venture with hotel company Summit Hotels to develop a hotel in Wembley.
The jv will develop the property as a 262 bedroom hotel and will be operated as part of the Express by Holiday Inn franchise. Detailed planning consent has already been received for the development.
The joint venture will own and develop Malcolm House and Fulton House at Wembley.
The joint venture, owned 51% by Summit and 49% by Quintain, will buy out Quintain’s ownership of the property for £7.4m.
Summit will then have the right to buy Quintain out of the joint venture over the next 15 months.
The sale will include £5.15m in unsecured loan notes and £2.25m in cash.
The loan notes issued to Quintain will be repayable on 31 March 2012 or six months after practical completion of the development – whichever is soonest.
Nick Shattock, Quintain’s deputy chief executive, said: ‘This agreement will enable us to crate an excellent limited service hotel that is entirely suited to the future amenities and location of Wembley and will complement the full service offer elsewhere in phase one of the scheme’s development.’