Travelodge — Britain’s second biggest budget hotel operator — is capitalising on its strong 2014 performance by confirming plans to open 25 new sites every 12 months for the next six years.
The chain already has a £100m construction programme underway which will see the opening of 15 new hotels by the end of this year. Those new sites include four London locations, a new central Glasgow property, and key regional locations within the Thames Valley tech corridor, Southampton and Bristol.
With all its new sites expected to be up and running by 2022, Travelodge will create a total of 400 new jobs; the majority working within the hotels but with 50 in supporting roles.
George Osborne has already welcomed the company’s expansion plans. “Our long-term economic plan for the Midlands is to make the area an engine for growth by backing business and supporting growth,” he said.
“The expansion of a great British brand like Travelodge within a growing hotel and leisure industry in the UK, is fantastic news,” added the Chancellor. “Travelodge’s expansion is not just reliant however on tourists as increased demand from business customers and families have also boosted growth.”
When the rolling development plan is complete, Travelodge will own 510 hotels across the UK offering 37,906 rooms.
Peter Gowers is Travelodge chief executive. “We are well underway with our plans to build a new and extensive Travelodge,” he commented.
“In 2015 we are opening 15 new hotels, creating 400 new jobs, and extending our network still further, and with our modernised hotels and unbeatable value, we are well placed to serve the rapidly growing demand for low-cost travel.”
Gowers added that his company “saw the potential for more than 150 further hotels across the UK and look forward to creating more great places to stay and thousands more jobs over the years ahead”.
Travelodge’s preferred model is to work with developers and contractors who build the hotels which are then leased back to the leisure chain over a typical 25-year period. The firm suffered a blow last month when one of its main construction partners, Anglo Holt, went into administration.
Three years ago, in 2012, Travelodge took the unusual step of asking its landlords for rent reductions as part of a rescue deal that saw it jettison nearly 50 hotels. The crisis-hit operator effectively buckled under the financial strain of making repayments on borrowings of £1.1bn which date back to its debt-fuelled 2006 takeover by Dubai International Capital, the private equity arm of the oil-rich Gulf state.
