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Unviable Housing Sites Targeted By Travelodge

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Unviable housing sites targeted by Travelodge

By Daniel Thomas

Published: July 19 2008 03:00 | Last updated: July 19 2008 03:00

Travelodge, the budget hotel group, is hoping to exploit the downturn in value for residential development land to help boost expansion plans for its chain across the UK.

The group - owned by Dubai International Capital - is to send letters next week to housebuilders and property developers urging them to offer their "unviable" sites for use as hotels.

Travelodge wants to expand its chain by more than 1m sq ft this year - equivalent to about 45 new hotels - and hopes that the sharp downturn in market values means that it can strike bargain prices for previously expensive prime residential sites.

The cheaper end of the hotel market is performing strongly as businesses look to cut costs, and Travelodge wants to capitalise on this with its rapid growth plans.

The letter to developers from Paul Harvey, managing director, international and development, says: "Whilst two years ago you may not have considered a hotel to be optimum use for your developments, it is clear the landscape has changed dramatically. A Travelodge could well prove to be the ideal solution for sites that are currently not looking viable."

Travelodge operates 340 hotels, but has ambitious growth plans to run as many as 1,000 hotels by 2020, equivalent to a market share of 10 per cent.

It is keen on opening new hotels in town and city centres, particularly in London and the surrounding home counties.

Most sites would have been far more valuable for residential rather than commercial or hotel use until this year, when the fall in house prices began to seriously affect the value of the underlying land.

Housebuilders admit privately that some sites are effectively worthless in current market conditions because of an unwillingness to build homes that will not sell - and many are looking to move land assets from their balance sheets as they look to bolster cash positions.

"The correction in land values continues," Mr Harvey told the FT.

"Sites that would have gone to residential a year ago are suddenly no longer attractive and those are exactly the places that we usually want to expand.

"The residential market is under the most pressure for 15 years or more, which gives us an opportunity."

Mr Harvey said that it was already in discussion with developers in provincial towns and London boroughs to convert sites that were destined to become flats.

Travelodge is also planning an international expansion


200K luxury apartments turned into cheap Travelodge rooms ;) ?

Edited by Ash4781
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Shrewd move by Travelodge. Did anyone see that TV article a few months back on the middle aged couple who live in one permanently? If you book in advance you get the dirt cheap £19 per night rate - £577 per month, for (in effect) a luxury bedsitter with ensuite bathroom, daily maid service, Cable TV and all your utility bills included in the rent!

And the kids stay free in the room. Perfect for the newly homeless following repossession (no references, no credit checks, but you must pay obviously) - if I had a repo court date coming up and knew I was stuffed, and had a job but just could not service debts, rather than sleeping in the car I would book a TravelLodge.

They have seen what is happening and they will end up like the USA city motels, half accommodating business travellers and half long stay welfare cases. I once stayed in one in Dallas Texas, and there were crack whores all over the place, alongside regular tourists like us. Didn't stay long.

STRs unite and block book Travel Lodge advance rooms!

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200K luxury apartments turned into cheap Travelodge rooms ;) ?

It's an interesting thought, with all the en-suites it would actually be very easy to split them down into quite luxurious motel like accommodation. Just a matter of putting in some extra doors and fitted cupboards. Subject to planning of course, but if the local council is facing dereliction and poor employment they might not mind.

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Just don't get lumbered with the room next to the laundry room. I rented a Travelodge room for a couple of nights and the noise of someone working all night doing the laundry meant I didn't get much sleep. A single person would be better off

lodging with someone who had a spare room.

Plenty of people would be more than happy renting a room out for £50 a week and a bit of company.

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