Luxury hotel Fairmont St Andrews has been sold to a Beverley Hills-based property investment group for more than £32 million.
Kennedy Wilson Europe Real Estate snapped up the exclusive 209-bed property to complete its second top-end European hotel purchase this summer.
The Fife destination and golf resort was put on the market in the spring with a £37m price tag, with selling agent CBRE saying the sale offered a “truly unique” chance to establish the site as “one of the foremost conference, wedding, golfing and leisure destinations in the UK”.
Canadian management firm Fairmont Hotels & Resorts said it would work “diligently” with the new owners to ensure a smooth transition, while stressing the change of ownership would have no impact on the hotel’s day-to-day operations.
“The Fairmont St Andrews will continue to honour all guest reservations and group contracts and the employment of all hotel staff will continue with no changes to current conditions of employment for hotel colleagues,” a spokeswoman added.
The controversial £50m development, just south east of the ancient Fife town, was opened by US entrepreneur Don Panoz in 2001 but was subsequently bought over by New York-listed real estate and private equity firm Ares Management, with FRHI taking over the hotel’s management on a 25-year contract, in 2006.
Accounts for holding company St Andrews Bay Development Ltd posted at Companies House earlier this year revealed how its immediate parent had breached banking covenants casting “significant doubt on the company’s ability to continue as a going concern”.
Pre-tax losses more than tripled to £12.8m during the 12 months to December 2012.
Earnings were hammered by a £10.6m impairment on the value of the property, St Andrews Bay directors said, though gross profits were up 23% at £3.8m.
Mary Ricks, president and chief executive of Kennedy Wilson Europe, said the deal provided “a number of good opportunities to leverage our extensive asset management expertise”.
The hotel is set in 520 acres, with planning permission for dozens of new holiday homes on site.
Kennedy Wilson also paid 29.8m euros (£23.9m) for Dublin’s Portmarnock Hotel in June.