Travelodge continues expansion with purchase of 66 hotels

Travelodge has exchanged contracts for the purchase of 66 hotels from LXi REIT for a total consideration of £210m.

The 66 hotels are already operating under the Travelodge brand.

This comes as the hotel chain undergoes a period of expansion, targeting a total of 300 new sites. Travelodge expects to open six new hotels in 2024, with this number set to increase to 15-20 new sites a year once market conditions improve.

LXi REIT said the majority of the sale proceeds will be used to pay down debt, reducing its group loan-to-value rate from 38% to 34% and reducing Travelodge’s proportion of Group rent from 18% to 11%.

The sale is expected to finalise on 28 February.

Jo Boydell, chief executive of Travelodge, said: “The acquisition of 66 Travelodge hotels from LXi REIT, with support from our owner GoldenTree Asset Management, will mark a positive step for Travelodge as we seek to optimise our hotel portfolio and diversify our freehold/leasehold split to enhance value. The new structure will provide us with a platform to explore further freehold acquisitions. We have nearly four decades of expertise in operating budget hotels and we look forward to continuing to invest in our hotel network to drive growth.”