2nd Oct 2014 07:05
LONDON (Alliance News) - Action Hotels PLC Thursday said it is in the final stages of agreeing terms with an unnamed international partner for a long-term management agreement on a new hotel in the United Arab Emirates.
The 104-bedroom, 3-star hotel is located in the Ras al-Khaimah commercial district of the UAE.
Action said it has signed a 20-year lease agreement on an existing residential development and is to undertake a refurbishment and conversion of the interior of the Ras al-Khaimah hotel.
Action expects the project to cost USD4.8 million, to be funded though existing cash and debt facilities.
"As we highlighted at the time of our interims results earlier this month, this development underpins our strategy of using both freehold and leasehold models to accelerate growth in room numbers. Whilst we have shown to enjoy significant development uplifts on our freehold hotels, leasehold hotels are less capital intensive and which the board believes will lead to accelerated EBITDA growth," said Sheikh Mubarak A M Al Sabah, Action Hotels' Chairman and Founder.
Action Hotels were untraded at the open on Thursday, quoted at 71.5 pence.
By Sam Unsted; [email protected]; @SamUAtAlliance
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