Travelodge looks to partner with councils to open 300 new hotels

Travelodge is looking to partner with local councils to open 300 new hotels across the UK as part of a £3b expansion.

The budget hotel chain, which operates nearly 600 sites, has written to 220 local authorities across the country to propose a joint development partnership to "stimulate regeneration".

Travelodge has identified 300 target locations for new hotels across the UK as part of an expansion plan that could create around 9,000 jobs and represent a £3b investment for third-party investors, the company said.

It would see branded hotels open in over 120 towns, such as Ripon, Lichfield, and Cromer, for the first time.

Travelodge opened three hotels in partnership with local authorities in 2022, two in London at Docklands and Wimbledon and a third in Braintree in Essex. The group is also building two hotels in partnership with councils in Rotherham and Colchester.

The agreements had funding structures which enabled local authorities to utilise existing assets and regenerate brownfield land in strategically important locations.

Some of the new Travelodge hotels in the programme were built on surplus local authority land, with the funding provided either through the local authority's internal resource, or from the Public Works Loan Board or a third party.

On completion, local authorities had the choice of either retaining ownership of the hotel and receiving an annual rent into the council's revenue budget or selling the hotel with Travelodge as its operator.

The two recent London Travelodge hotel openings at Docklands and Wimbledon and in Colchester were lease-wrapper deals, also known as income-strip deals. Under this structure, the council takes a headlease, with Travelodge being the undertenant. The rent that the council pays is lower than the rent it receives from Travelodge with an annual profit rent for a 30+ year period.

Steve Bennett, Travelodge chief property and development officer said: "In the current climate, local authorities are under extreme pressure to invest in their economy and support regeneration projects. This is why we are today writing to 220 local authorities to offer our support, as we can make a real difference.

"Adding a Travelodge hotel can be a catalyst to attract new businesses, support regeneration, bring vacant buildings back into economic use as well as attracting thousands of new overnight visitors to the area and revitalising high streets."

Travelodge opened its first hotel in 1985 on the A38 Burton under Needwood. Today the UK's second largest hotel chain operates nearly 600 hotels across the UK, Ireland, and Spain.