US aparthotel operator Sonder has pulled out of a £20 million project in Belfast with Co Down property group Lotus.
But the NASDAQ-listed company has now confirmed it will not be progressing with the Lotus project.
Sonder, which is currently based in 40 cities around the world, said it will instead partner with the Z Property Group for its nine-storey Dublin Road scheme in Belfast, which will feature 84 serviced apartments.
Work has already commenced on the project.
Lotus Property, which owns The Boulevard and The Junction shopping outlets, bought the former HMRC offices at Beaufort House in 2020 with the intention of turning it into an upmarket office scheme.
But the shift in market demand for office space in the post-pandemic period saw the Banbridge firm go down the hospitality route.
Lotus secured planning approval last year for a 113-bedroom aparthotel.
Work on the new hospitality scheme was due to start in early 2024, but there is little sign of progress at the prominent city centre building.
Lotus declined to comment on Sonder’s withdrawal or the future of the aparthotel project.
The loss of Sonder from ‘The Well’ comes as Lotus faces the loss of its biggest tenant at The Junction.
US investor Ares Management, which controls garden centre chain Dobbies, confirmed earlier this month that its new superstore at the Antrim retail complex is set to close by the end of this year.
The 110,000 sq ft retail venture was launched at The Junction one year ago following a multi-million pound investment.
The Z Property Group is a relatively new name in the north’s development scene.
Set up in 2021 by former McAleer & Rushe project manager Scott Kennedy, the group is divided into a building contracting arm and a division devoted to property management and development acquisitions.
Its projects include the Stoney Manor housing development in Newbuildings and the former Glens Hotel in Cushendall, which is set to be redeveloped into The Cushendall Inn.
Scott Kennedy said the Dublin Road scheme is due to open by the fourth quarter of 2025.
“This is an exciting venture for Z,” he said. “Dublin Road is in a prime location in Belfast’s University Quarter and we believe Sonder’s award-winning design credentials and reputation will complement the city’s thriving hospitality sector.”
The project recently secured a £9m loan from commercial lender Assetz Capital.
Commenting on its move into the Belfast market, Sonder’s director of real estate, Alix McAlinden said: “We’re excited to continue expanding our presence in the UK & Ireland in a vibrant new location with a well-established landlord partner.
“Belfast has become a globally recognised destination for food, culture, commerce, shopping, and the arts and is a perfect market for Sonder to continue redefining the guest experience through technology and design.
“We have been looking carefully for the right opportunity to open our first building in Belfast and we look forward to being part of this exciting and flourishing city.”
