A London-based group has been granted a £28 million loan from a Stormont-backed investment fund to help build a hotel in Belfast’s Titanic Quarter.
The JMK Group has already started work on the Hamilton Dock Hotel next to Titanic Belfast.
Estimated to cost in the region of £36m, the hotel project has become the biggest borrower from the Northern Ireland Investment Fund (NIIF) since it was launched in 2018.
Using funding provided by the Department of Finance, the NIIF operates as a private sector entity, providing debt funding for ‘commercial property, regeneration and low carbon projects’.
The money comes from Stormont’s financial transactions capital (FTC) funding pot.
The NIIF loan portfolio includes some of the largest developments built in Belfast city centre in the past number of years, including Merchant Square, the Paper Exchange and Oakland’s aparthotel on Queen Street, now known as Room2.
It also financed The Ebrington Hotel in Derry, Haslem Hotel in Lisburn, the Kings Hall Health and Wellbeing Park and the 575-space multi-storey car park on Belfast’s Grosvenor Road.
Last June, it provided £21.3m for a 307-unit student accommodation block on York Street, taking it past the £100m mark.
The NIIF, which is managed by CBRE, has since been increased to £150m, with the £28m for the JMK Group representing its largest loan to date.
Originally proposed in 2019 as a 276-bed hotel in the Titanic Quarter, JMK redrew its plans on a number of occasions, eventually settling on a 135-bed hotel alongside 93 aparthotel units.
It will operate under Mariott’s Aloft & Residence Inn brand.
It’s understood the Dunmurry-based construction group Farrans has been appointed as the main contractor by the family-owned company, headed by John Kajani.
The construction phase is expected to involve around 60 roles, with 70 full-time jobs created once the hotel becomes operational.
Herbin Duffield, director at CBRE, which manages the fund said: “When the Northern Ireland Investment Fund launched in 2018 there was sufficient debt liquidity and supply of new hotel developments in Belfast.
“The pandemic and rising interest rates have tested those conditions, and supply and debt liquidity is now more constrained.”
He added: “NIIF is addressing market failure and providing debt funding that will create jobs in a key regeneration area in the city’s Titanic Quarter by delivering a hotel with strong environmental and sustainability credentials.
“Having explored a range of funding options and solutions for this site, we are delighted to have committed a loan facility to finance the delivery of this project.”
Zain Kajani, director at JMK added: “We are pleased to have the funding in place and break ground at the JMK group’s first hotel in Northern Ireland, adding further depth to our hotel portfolio in the UK and Republic of Ireland, and aligning with our expansion strategy and forward-thinking approach to drive sustainability.”
