Hamstrung by its indebtedness to Skye Bank Plc, among other financial institutions, the Milan Group, owners of InterContinental Hotel, Lagos, is seeking to sell 25 per cent of its shares in the hotel, THISDAY has learnt.
As part of their investment in the real estate sector, Skye Bank and a consortium of other banks had funded the construction of the $135 million hotel in 2009. Sixty per cent of the funding came from Skye Bank.
However, THISDAY gathered that the debt has been emasculating the operations of the four-star hotel which has been operating at a loss since it opened about a year ago.
Other than mounting interest payments on the bank loan, it takes a hotel the size of InterContinental three to five years to break even, explained a market source conversant with the move by the Milan Group to sell its interest in the hotel.
“The Milan Group has been having serious difficulty in paying the debt incurred in the construction of the hotel and so the group is willing to sell 25 per cent of its holdings so as to reduce the debt,” the source explained.
Built on an elevated terrain, the 23-storey InterContinental boasts of 352 rooms and is fully owned by Milan Group.
The hotel is located on Victoria Island in the centre of Lagos, home to major consulates and multinational companies. This makes it a perfect residence for affluent business and diplomatic travellers.
Owing to its location, the hotel offers uninterrupted spectacular views of the Lagos skyline, ample meeting space and grandiose accommodations. Its restaurants offer an array of dining options from cosmopolitan to Nigerian delicacies.
Skye Bank had in 2009 explained that the investment in the hotel was in line with its support for investment in the real estate and hotel sectors.
Milan Group has operated in Nigeria for over 20 years as a major importer and distributor of rice, sugar, fruit juice and tyres.
With assets worth $750 million, the group and its associated companies have investments in real estate, the financial sector and hotels.
The group currently has a total of 20 hotels across Africa with plans to expand its footprint by 20 per cent in the next five years.
As part of their investment in the real estate sector, Skye Bank and a consortium of other banks had funded the construction of the $135 million hotel in 2009. Sixty per cent of the funding came from Skye Bank.
However, THISDAY gathered that the debt has been emasculating the operations of the four-star hotel which has been operating at a loss since it opened about a year ago.
Other than mounting interest payments on the bank loan, it takes a hotel the size of InterContinental three to five years to break even, explained a market source conversant with the move by the Milan Group to sell its interest in the hotel.
“The Milan Group has been having serious difficulty in paying the debt incurred in the construction of the hotel and so the group is willing to sell 25 per cent of its holdings so as to reduce the debt,” the source explained.
Built on an elevated terrain, the 23-storey InterContinental boasts of 352 rooms and is fully owned by Milan Group.
The hotel is located on Victoria Island in the centre of Lagos, home to major consulates and multinational companies. This makes it a perfect residence for affluent business and diplomatic travellers.
Owing to its location, the hotel offers uninterrupted spectacular views of the Lagos skyline, ample meeting space and grandiose accommodations. Its restaurants offer an array of dining options from cosmopolitan to Nigerian delicacies.
Skye Bank had in 2009 explained that the investment in the hotel was in line with its support for investment in the real estate and hotel sectors.
Milan Group has operated in Nigeria for over 20 years as a major importer and distributor of rice, sugar, fruit juice and tyres.
With assets worth $750 million, the group and its associated companies have investments in real estate, the financial sector and hotels.
The group currently has a total of 20 hotels across Africa with plans to expand its footprint by 20 per cent in the next five years.
Culled from thisdaylive.com
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