Group Sells London Park Hotel

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InterContinental Hotels Group Plc has sold its London Park Lane Hotel to a Middle Eastern investment group for $457 million, a 62 percent increase of its net book value at the end of 2012.  

InterContinental, the world's largest hotel-room provider, will manage the hotel under a 30 year agreement, which can extend another 30 years. Management fees are expected to be around $6 million a year, according to a IHG release.

IHG Chief executive Richard Solomons credited the transaction as proof of "the value of our asset portfolio," adding in the statement "we are very pleased to be working closely with Constellation Hotels, a respected hotel investor." 

The 447-room hotel opened in 1975 and generated revenues of $89 million in 2012. IHG expects the transaction to close in the second quarter of 2013, using $93 million of its proceeds towards UK pension liabilities, previously secured against the hotel.