Hallmark Hotels

Consumer & Leisure

Hallmark Hotels was a buy-and-build opportunity in the UK regional hotel sector.

Key Facts

Initial investment: 04/10/2007

Sector: Consumer & Leisure

Fund: Buyout Fund I

Status: Realised

Investment Highlights

  • Acquired eight hotels across the UK including Manchester, Carlisle, Derby, Bournemouth, Hull, Gloucester and Croydon.
  • Worked with management on a market mapping exercise to identify target assets.
  • Appointed a highly experienced hotelier with a track record of undertaking major refurbishment programmes, as chairman.
  • Completed the successful sale of Hallmark to Topland Group Limited for consideration of circa £75m generating a 2x return.

Partnership Motivation

We were impressed by the experienced management team, led by Arnold Schnegg and James Hawksworth who had successfully implemented a similar strategy as part of the operational team at Paramount Hotels. The strategy was based on acquiring underperforming 3-star hotels and converting them into 4-star hotels through a combination of operational improvement and refurbishment.

Hallmark’s success was achieved through a robust acquisition strategy, driven by a talented and committed management team. The UK hotel market has faced challenging times, but through focus on providing a high quality product combined with significant operational improvements and a coherent sales strategy, we have built an impressive chain of 4-star hotels. It has been a pleasure working with the management team and we’re pleased to have secured a good return for our investors.

Ed Fazakerley, Partner