Manhattan’s largest hotel operator has secured control of one of the most prominent sites on Shoreditch High Street, E1, as a foothold from which to build a 20-hotel London portfolio.
Highgate Holdings is shortly to submit plans for a 300,000 sq ft mixed-use project at 201-207 Shoreditch High Street and 1 Fairchild Street, including a tower of up to 30 storeys (pictured). The scheme is expected to have a gross development value of more than £300m.
At the heart of the scheme will be a new 200-bedroom luxury hotel. It will also include 100,000 sq ft of offices, community retail and leisure space, a sky lounge and a ground-floor market, as well as extensive public realm improvements.
The site, adjacent to Shoreditch High Street train station, is currently occupied by Majestic Wine Warehouse and the Chariots sauna. Forming one of the corners of the Shoreditch Triangle, it is owned by family property company Folgate Estates.
With the terms of the deal yet to be finalised, Highgate is expected to make a minimal up-front payment for its stake in the site, forming a profit-sharing joint venture with Folgate.
Highgate is due to submit plans for the Shoreditch site in the next four weeks, with construction earmarked for the end of 2016 and an opening date towards the end of 2018.
The company has also instructed BC Retail to secure sites for a 20-hotel London portfolio that could cover as much as 8m sq ft.
It will seek sites with capacity for 40,000 sq ft to 400,000 sq ft within the M25 for further developments.
Developers have been keen to capitalise on Shoreditch’s rising popularity, but larger schemes such as British Land’s Blossom Street and Hammerson and Ballymore’s Bishopsgate Goodsyard have met fierce opposition.
The inclusion of offices in the scheme is intended to make the application more amenable to Hackney council, which wants to see more flexible business space built in the area.
Highgate owns and operates 10,000 hotel bedrooms in New York and a further 30,000 worldwide, including such iconic New York brands as the Knickerbocker on Times Square, the Refinery, the Quin, Westhouse and Row NYC.
It has also been involved in major office and retail deals, including the $1.3bn (£850m) purchase, with Crown Acquisitions, of 650 Madison Avenue from Carlyle Group in 2013.
Architects Gensler and New York-based Rockwell Group design Highgate’s projects.
Hanover Green advised Folgate on the site sale.