Administrator to buy out GuestInvest investors

The administrator of GuestInvest has reportedly made an offer to buy out individual investors in order to facilitate the sale of the buy-to-let hotel operator’s main properties.

Deloitte has sold a property in Leinster Square, Notting Hill, for an undisclosed sum and is understood to be close to agreeing the £25m sale of Blakes, the boutique hotel in Kensington acquired by GuestInvest in 2007, according to The Times.

The administrator has not disclosed how much it had offered the 60 to 80 investors who had completed their purchases, although it is likely to be well below what they paid, reflecting the fall in property values since the projects were started.

But the sale of three uncompleted properties, two of which are located in Bayswater and the third in Chiswell, has been put on hold for several weeks after offers were deemed to be too low.

The three properties involved are The Nest, a 157-room property in Bayswater, which was close to completing a £45m revamp when the group collapsed in October; The Jones, a £70m, 174-room development in Bayswater; and The Brewery, which requires a further 12 months' work to complete a £75m development in Chiswell Street.

GuestInvest's first hotel - Guesthouse West in Notting Hill - is unaffected, as it is understood to have been financed separately by Johnny Sandelson, who set up the company in 2004.

Similarly, Blakes, which had yet to be converted to the buy-to-let concept, does not form part of the administration and continues to trade normally.

There are rumours that Sir Mark and Lady Weinberg, who sold Blakes to GuestInvest at the end of 2007 for a reputed £43m, are connected with the prospective purchasers. Weinberg, also known as Anouska Hempel, the designer, created the hotel and continues to be involved in its management.

The collapse of GuestInvest was attributed to cost overruns and delays to its main development projects, as well as the financial hardship of HBOS, its debt provider and equity joint venture partner.

GuestInvest sale put on hold after disappointing bids >>

Buy to let model under threat as GuestInvest fails >>

Buy-to-let firm GuestInvest goes into administration >>

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GuestInvest acquires two more central London properties >>

By Gemma Sharkey

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