Croydon Council has made an offer believed to be around the £25million mark for the freehold of The Croydon Park Hotel.
The amount which the council hasn’t disclosed has been accepted and the authority is now in the final stage of the purchase, which is expected to generate around £1m a year in additional income to the council, securing a new revenue stream to fund core services.
Property Week reported in June that private equity company Evans Randall had put the four star hotel on the market for £25m, a price which would reflect a net initial yield of 6.5 per cent.
The current leaseholder will be responsible for the operation of the hotel.
Cll Simon Hall, cabinet member for finance and resources, said: ““At a time where government grant funding for local authorities continues to fall, we have to look at new and innovative ways to ensure we can provide services to residents.”