Royal Bank of Scotland (RBS) has reportedly been forced to postpone the sale of a £1.1b package of Hilton hotels for the second time in two months.
The 15 hotels, including the Waldorf Hilton and Cumberland hotels in London, were due to been sold to Robson Asset Management (RAM), an investment vehicle set up by former RBS finance executive Jeremy Robson.
But growing cost of debt has forced RBS to pull the deal, which was due to be completed last week, according to The Times.
A source close to the deal told the newspaper: “The cost of the debt on this deal went up by a significant margin due to the credit crunch.
“The fear is that if debt gets more expensive, there could be a hit on asset prices. All of which is creating huge nervousness among investors.”
It is understood that RAM had provisionally raised about £200m of equity funding.
Robson, who quit RBS in May, was to have put some of his own money into the deal alongside a consortium including Igal Ahouvi Group, the Israeli property investor.
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By Daniel Thomas
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