OakNorth and ASK Partners have jointly provided a £19.5m loan to Capilon Hotels Group for the redevelopment of a vacant hotel in Paddington.

Capilon, known for its expertise in property investment, development, and management, will use the funds to transform a nine-storey, Grade II listed building on Westbourne Terrace into an 80-room boutique hotel. This property, located near Hyde Park and Paddington station, offers easy access to many of London’s top tourist attractions.

Ben Hall, CEO of Prima, a global private equity real estate company partnering with Capilon, stated, “The strategic acquisition of this prime property not only signifies our focus on the resilient London hotel market but also positions us in one of London’s most attractive growing sub-markets. We’re confident this institutionally structured deal, coupled with the benefits of using a Singapore VCC investment structure, will provide our investors with a unique risk-adjusted opportunity to invest into the United Kingdom’s real estate market.”

Lucas Anglin, associate director of debt finance at OakNorth, remarked, “As a result of Capilon Hotels’ hugely talented team, the group has built a highly impressive reputation for delivering quality hotels across London. With the capital’s hotel market set for significant investment going forward, the firm is in a perfect position to capitalise on this tailwind. We’re delighted to have been able to support such a well-renowned and established hotel firm and we look forward to watching their growth story going forward.”

This redevelopment project is expected to revitalise the Paddington area and enhance the local hospitality market.