December 2021 - Travelodge Property Development

Newcastle Cobalt Business Park gets a new Travelodge hotel

Newcastle Cobalt Business Park Travelodge is the first budget hotel to open at Europe’s largest business park and will offer rooms from £29

Travelodge, one of the UK’s biggest hotel brands is delighted to announce it has officially opened the first budget hotel at Europe’s biggest business park, Newcastle Cobalt Business Park – which is home to 150 companies. This opening boosts the company’s portfolio to over 590 hotels in the UK, Ireland and Spain including seven hotels in Newcastle and ten in Tyne and Wear.

Newcastle Cobalt Business Park Travelodge features 80-rooms, an on-site restaurant called the Bar Café which offers a breakfast, dinner and bar service. The hotel also offers an on-site car park. This opening has created 20 new jobs within the local community.

The hotel development is part of a regeneration programme which has involved converting a redundant office block into a new hotel with an extension.

Newcastle Cobalt Business Park Travelodge is one of 17 hotels, Travelodge has opened in 2021. Collectively this expansion programme of 17 hotels represents an approximate investment of £175 million for third party investors and a creation of 360 new jobs.

Newcastle Cobalt Business Park Travelodge has been styled in the company’s contemporary brand design, which has been created by business and leisure customers. It offers family, double and accessible rooms starting from £29. Rooms can be booked at www.travelodge.co.uk

All rooms feature the bespoke luxurious king-size Travelodge Dreamer bed which is produced by Sleepeezee who hold a Royal Warrant from HRH The Prince of Wales. The Travelodge Dreamer bed sits within a mood lighting surround and has spacious bedside shelves featuring his & hers charging ports. In addition all family rooms include two individual beds for children.

The rooms also feature a modern en-suite bathroom, power shower, comfort

cooling, to enable you to personalise the temperature of your room, a 32 inch

Freeview TV, complementary in-room tea & coffee making facilities and access to Wifi.

The Bar Café offers a great value breakfast & dinner menu and a bar service that offers a range of aperitifs such as a gin menu, a broad range of red & white wines,proseccoand champagne.

Travelodge offers an unlimited breakfast at just £8.75, and for each paying adult two children eat for free. Additionally Travelodge has great dinner menu meal deals too – adults can eat a delicious main course plus a side dish or dessert for just £12.25 and Travelodge’s kids menu offers 3 courses and a drink for only £6.25. For more information please visit https://www.travelodge.co.uk/about/our-restaurants/

Newcastle Cobalt Travelodge is being managed by Colin Evans, who has worked for the company for over three years. Colin was previously Hotel Manager at Newcastle Airport and Gateshead Travelodge hotels.

Colin Evans, Hotel Manager, Newcastle Cobalt Business Park Travelodge said: “Weare delighted to open our first hotel in Cobalt Business Park in time for Christmas. There has been a desperate need for good quality and low cost accommodation within the area for some time and this new Travelodge is ideally located for business and leisure travellers. With today’s opening we now operate over 590 hotels across the UK, Ireland and Spain which includes seven Travelodge hotels in Newcastle.”

“I have built a great team and our hotel has got off to a flying start. As Travelodge is the nation’s spare room provider we have seen an increase this year in bookings across our Newcastle hotels from locals and from travellers from all corners of the UK who are visiting family and friends in Newcastle this festive season. Nowadays not many households have a spare room and Britons have outgrown sleeping on the sofa or on the floor, comfort is key and our Travelodge Dreamer beds don’t disappoint on getting a good night’s sleep. This is great news for the local economy as research shows; annually Travelodge customers will spend double their room rate with local businesses during their stay, which can equate to a multi-million boost for the local economy.”

“Once we get over the Christmas rush, I am also looking forward to developing my team and to help them to climb the career ladder at Travelodge. The majority of my team are parents and at Travelodge we are dedicated to supporting working parents, by offering flexible working hours around the school run; so that they can work, climb the career ladder and raise their family.”

Guy Marsden, Director Highbridge Properties Plc, Developers of Cobalt Business Park: “We are delighted that Travelodge has joined the already strong range of amenities on Cobalt Park, and clearly proves the location continues to be a major success story for North Tyneside and the region as a whole. We look forward to welcoming Travelodge into the Cobalt Business Community”.

New appointments in the Property & Development team

The Travelodge Property & Development team is growing to help achieve the group’s property & development strategy. We are delighted to welcome:

Stuart Williams: UK Head of Estates

Stuart Williams joins Travelodge as UK Head of Estates. This role is a key link between Travelodge and its landlords and Stuart will be responsible for the day to day management of the Travelodge estate, provide a support service for Travelodge landlords and also seek growth estate opportunities to help unlock value in assets for the benefit of landlords and Travelodge.

Stuart was previously Interim Head of Property at Game Retail and prior to this Stuart was the Property Director at Majestic Wines.

Jeremy Hill: Head of Refit

Jeremy has been providing a consultancy service to the Travelodge Property & Development team for over seven years and has now been appointed to the new role of Head of Refit to oversee the estate’s multi-million refit programme.

Jeremy’s project management and leadership skills, along with his knowledge of Travelodge will be invaluable in this new role. Jeremy is currently setting up his department and is recruiting for a team of Project Managers.

Ian Pidgeon: Head of Construction

Ian Pidgeon has been at Travelodge for the last 13 years. He has held a range of roles including Construction Project Manager, Refit Programme Manager and Head of Capital Projects and has now been appointed to the new role of Head of Construction.

In his new role, Ian will be responsible with his team to oversee the development of all new Travelodge hotels and other key development projects. He will represent Property Services in our sustainability review and in matters of Building Safety.

Travelodge fulfils commitment to open 17 hotels in 2021

In Q4, Travelodge opened four new hotels to complete its 2021 new hotel openings programme. With the opening of these four hotels, Travelodge has opened 17 new hotels across the UK this year and created 360 new jobs. Collectively, these 17 hotels represent an investment of £175 million for third party investors and will boost the group’s hotel network to over 590 locations in the UK, Ireland and Spain.

Two out of the four hotels opened in Q4 are located in London’s top growth hotspots – Elephant & Castle and Manor House. Both of these hotels are situated in a prime location, close to the tube station. The other two hotel openings include the group’s seventh hotel in Newcastle, at Cobalt Business Park, the UK’s largest office park, and its second property in Walton on Thames, Surrey.

London Elephant & Castle Travelodge, a 140-room hotel and London Manor House Travelodge, a 143 room hotel are both Travelodge Plus concepts. This is the group’s ‘budget chic’ hotel format, featuring SuperRooms, signature rooms and an on-site, contemporary designed restaurant and bar called The Bar Café. Launched in 2018, Travelodge Plus is designed around the needs of the budget traveller who wants that little bit more style and choice, with little touches to make it easier to work and relax both inside and outside the room.

With these two new additions, Travelodge now operates 79 hotels across London and is one of the biggest hotel chains in the capital.

Newcastle Cobalt Park Business Park Travelodge, an 80-room hotel with a Bar Café restaurant, is the first budget hotel to open at the business park which is home to over 150 companies and 14,000 employees, including some of the world’s top companies. The new hotel is an office conversion, with a new build extension and on-site car parking.

Walton on Thames Central Travelodge, a 72-room hotel, is also part of a regeneration programme, which involved converting a redundant office above an existing ground floor supermarket, into a new Travelodge hotel. The ground floor is a Marks & Spencer Foodhall, with the new Travelodge sitting above.

The property is owned by Aviva, which has funded and developed the Travelodge to secure long term income and improve its asset value.

This hotel will feature SuperRooms – the group’s premium economy room-type, which dials up the comfort factor and is designed for customers who want the choice of a more premium room.

St Albans Travelodge opened earlier this year

Detailed below are the 17 hotels Travelodge has opened in 2021

1. Boston (Lincolnshire)

2. Bristol Avonmouth

3. Bristol Emersons Green

4. Faringdon (Oxfordshire)

5. Kendal (Lake District)

6. Leicester city centre

7. London Elephant & Castle (Travelodge Plus)

8. London Manor House (Travelodge Plus)

9. Mansfield

10. Newcastle Cobalt Business Park

11. Newark on Trent

12. Poole

13. Rochdale

14. Sandwich

15. St Albans (Travelodge Plus)

16. Walton on Thames

17. Witney

The Staycation helps deliver record Q3 results with resilience in budget travel market

Performance Overview

Throughout Q3 and into Q4, Travelodge has outperformed the rest of the Midscale and Economy hotel sector. Overall UK like-for-like RevPAR for Travelodge for the third quarter was up 11.8% on 2019 levels, approximately 17.8pts ahead of the STR MSE benchmark competitive segment.

Total revenues for the third quarter were up 9.9% on 2019 levels, driven mainly by strong leisure demand and benefiting from the lower VAT rate, peaking in August, with accommodation revenue up c. 30% on 2019 levels.

Costs remained well-controlled and whilst Travelodge is not immune to the supply chain pressures affecting the wider hospitality industry, these have been well managed, supported by our in-sourced housekeeping model and strong supplier relationships.

EBITDA (adjusted) for the third quarter was £87.2m (2019: £57.5m, 2020: £4.1m).

Recent Trading

The MSE segment continues to recover ahead of the UK market and in recent weeks is seeing revenue as a percentage of 2019 levels around 15% points higher than the total hotel market, driven mainly by domestic leisure demand.

We have continued to outperform the STR MSE benchmark segment, with UK like-for-like RevPAR performance in the first weeks of the fourth quarter c. 11% above 2019 levels and approximately 12pts⁽^[5]⁾ ahead of the competitive segment, with our hotels in London and the Regions both outperforming.

The cash position remains strong.

Outlook

Forecasting remains a challenge and we expect the recovery will depend on several factors, including the continued effectiveness of the vaccines, consumer and business behaviour and, more broadly, the general economic environment. Also, the industry faces some short-term uncertainty around cost headwinds, particularly with the increase in the National Living Wage and employer National Insurance Contributions.

The MSE segment is expected to continue to recover fastest, benefiting from its domestic focus, business/leisure mix and value proposition. We expect to return to 2019 RevPAR levels during 2022, with sustained ‘blue-collar’ business demand, and strong leisure demand offsetting a more gradual recovery in ‘white collar’ corporate demand.

We expect to open six new hotels in 2022, lower than our long run averages, as new deals were impacted by Covid-19 in 2020, but returning to more normal levels thereafter.

Highlights (quarter ended 30 September 2021, comparison vs 2019)

Total revenue up 9.9% to £229.5m (2019: £208.8m, 2020: £88.2m)
RevPAR^{(^[1])} up 11.8% to £53.54 (2019: £47.89, 2020: £21.24)
RevPAR performance 17.8pts ahead of the competitive segment^{(^[2])}
Occupancy⁽¹⁾ down (1.1)pts to 83.6% (2019: 84.7%, 2020: 51.7%)
Average room rate⁽¹⁾ up 13.3% at £64.04 (2019: £56.53, 2020: £41.11)
EBITDA^{(^[3])} profit of £134.0m (under IFRS 16) (2019: £111.5m, 2020: £31.0m)
EBITDA (adjusted)^{(^[4])}profit of £87.0m (2019: profit of £57.5m, 2020: profit of £4.1m)
Cash of £151.4m at 30 September 2021
15 new hotels opened
Total network now 593 hotels and 45,285 rooms as at 30 September 2021

[1] Revenue per available room, Average room rate and Occupancy on a UK like-for-like basis for the management accounting period 1 Jul 2021 to 29 Sep 21, 2 Jul 2020 to 30 Sep 2020 and 4 Jul 2019 to 2 Oct 2019 for the quarter. Revenue per available room, Average room rate and Occupancy on a UK like-for-like basis for the management accounting period 31 Dec 2020 to 29 Sep 21, 2 Jan 2020 to 30 Sep 2020 and 3 Jan 2019 to 2 Oct 2019 for the quarter.

[2] Our competitive segment is the Midscale and Economy Sector of the UK hotel market as reported by Smith Travel Research (STR), an independent hotel research provider, providing aggregate benchmarking information on the UK and other hotel market performance

[3] EBITDA = Earnings before interest, tax, depreciation, amortisation and non-underlying items presented on an IFRS basis – including IFRS 16.

[4] EBITDA (adjusted) = Earnings before interest, tax, depreciation and amortisation, and before rent adjustment and non-underlying items, and in line with historic accounting principles (before IFRS 16). This measure reflects the cash benefit of rent reductions following the CVA which completed on 17 June 2020. Non-underlying items have been removed as they relate to non-recurring, one-off items.

Carter Jonas secures the South East of England as a target location to find Travelodge hotels

To support Travelodge’s growth strategy, the company has expanded Carter Jonas’ Development Manager remit to include the South East of England (outside of the M25), to find and acquire new Travelodge development projects.

Carter Jonas has been retained as Travelodge’s Outsourced Development Manager for the East of England for over 10 years and has delivered many fantastic new Travelodge hotels during this time. Travelodge is now delighted to extend this Development Manager remit to also include our target requirements in the SE of England outside of the M25 (which continues to be dealt with by Alan Oliver and John Hardy). Samuel Turner is our retained DM at Carter Jonas and has the responsibility to find a further 90 potential Travelodge hotel sites across the East and South East regions. This expansion could represent an approximate investment of £500 million for third party investors.

“We are looking to grow our network of hotels across the UK and the South of East of England is a key growth area, as there is a desperate need for good quality and low cost accommodation. Samuel’s performance in finding and delivering the perfect Travelodge hotel sites in the East of England has been outstanding and we are therefore delighted to add the South East of England to his remit. We are confident that Samuel can help us to achieve our target of 90 hotels across both regions.”

“Despite a challenging 12 months, Samuel has continued to successfully acquire Travelodge hotels in our desired cities and towns, with recent deals delivered in Harwich, Ipswich and Braintree.”
Tony O’Brien, Travelodge UK Development Director

“We are delighted to further our relationship with Travelodge in assisting with their expansion plans across the South East of the UK. Travelodge have instructed us to secure hotels in 41 locations across the South East and 53 locations across the East of England”.

“In the South East region, Carter Jonas will work with Alan Hill of Alan Hill & Co, who will continue with his site finding role for Travelodge, whilst Alan Oliver and John Hardy retain Development Manager responsibility for acquisitions for Travelodge within the M25 area.”
Samuel Turner, Outsourced Development Manager, Carter Jonas

Travelodge Maintenance team is expanding

Travelodge is investing in its in-house maintenance team and has added 65 new full time Maintenance Engineers positions to boost its function. On average annually, the 165-nationwide team will be completing more than half a million jobs across the groups 582 UK hotels. There a few positions that still need to be filled including the following roles:

3 Maintenance Engineers (Oxford/Milton Keynes, Leicester, Cricklewood London areas)
Carpet Fitter (Walsall)
Planned Maintenance Water Operative (Walsall)

If you know of anyone that may be interested in the above roles please ask them to contact careers@travelodge.co.uk for further information.

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