Denbighshire County Council and Ion’s Travelodge development is underway in Rhyl – using innovative lease structure
The Travelodge scheme on Rhyl’s waterfront has begun construction following enabling works in late 2017. The development includes a 73-bedroom Travelodge with a car park and a 150-cover Marstons pub and restaurant. Built on the site of the East Parade car park, it forms an integral part of the £25m Rhyl Waterfront regeneration scheme led by Denbighshire County Council.
Funded by a private investor, the development follows an interesting structure where the client, Denbighshire County Council, will hold the head lease or shielded lease for the development. This structure, only just emerging, allows the council to support the funding with their covenant, increasing the property yield and allowing Denbighshire County Council to make a small profit on the scheme through rent. It is only the second time this type of development structure has been used after the model was piloted with a Travelodge development in the West Midlands.
Steve Parry, managing director of Ion Developments said: ‘Our work with Denbighshire County Council on the Rhyl waterfront is set to provide a boost for this seaside town’s economy as part of the Council’s ambitious vision to transform the waterfront. This innovative structure underlines Denbighshire’s commitment to the regeneration of Rhyl. It offers the opportunity to deliver a sustainable development in areas that might otherwise be unviable.’
The Travelodge is the second part of the £7m Waterfront development scheme being led by Ion on behalf of Denbighshire County Council, after Ion completed exterior refurbishment works to sections of the Pavilion Theatre and car park and the conversion of the Sky Tower into a light beacon.