Grange hotels co-founder Tony Matharu's Integrity International Group has exchanged to buy Atlas House, a City office building that is the latest to be sold as a hotels redevelopment opportunity.
US group Hines is selling the listed neighbour of the Bank of England for £34.55 million.
High-end serviced office operator The Argyll Club vacated the 44,200-square-foot office last year. Feasibility studies drawn up for the building suggest it could be increased to around 79,000 square feet with a rooftop extension. Architect DMFK's proposals suggest an up to 150-room hotel and a terrace could be developed.
Hines bought the office, then let to Barclays Bank, in 2013 for its Pan-European Core Fund for £35 million.
Colliers advised Integrity while Knight Frank and Savills Frank advise Hines.
Office to hotel sales have been increasingly popular in the UK.
Cushman & Wakefield reports that more than £2.4 billion of UK real estate was transacted by hotel investors in 2023, with just over a fifth (£0.5 billion) of that total comprising office sites which are planned to be converted into new hotel accommodation.
London in particular witnessed a boom in development projects with office-to-hotel conversions particularly popular. Cushman reports that this has been driven by the "prime location of many office buildings, coupled with the desire to maximise underutilised real estate and the growing demand for hotel accommodation".
Several local authorities are actively backing the move, with the City of London Corporation standing out particularly.
Notable London deals included the acquisitions of Haymarket House by Criterion Capital, 5-10 Great Tower Street by Dominus, and New London House by Whitbread.