Hotel occupancy in major cities across the world has plummeted almost overnight. But one investor and developer has still managed to push through a major development finance package for a large new scheme in London.

PPHE said Wednesday that it had agreed a £180M development finance facility with Israeli lender Bank Hapoalim to fund the construction of an upscale art’otel — a PPHE brand, marketed through Radisson — just off Old Street in east London. The hotel will have 343 rooms, five floors of offices, a gym and spa, and an art gallery in a 27-storey tower.

The hotel will cost £200M to develop and PPHE has already put in £43M of equity, some of which it will be able to unlock as a result of the development loan.

The loan has a floating interest rate of 4.2% and has an initial maturity of April 2024, although it can be extended by up to six years. The construction is set to complete at the end of 2023 or beginning of 2024.

PPHE owns and operates 37 hotels and resorts totalling 8,800 rooms across Europe with a combined value of £1.7B, with big concentrations in London and Amsterdam. Park Plaza is among its best-known brands, and as well as the scheme in London, it is also developing an art’otel in New York City.

The company has seen its share price fall 42% since the start of the coronavirus outbreak, giving it a market capitalisation of £522M. It said on 17 March it had closed 2,000 of its rooms in London.

According to STR, occupancy of London hotels fell 21% in the first eight days of March, a situation which is likely to have got worse since then, as restrictions on travel and social distancing measures have become more intense.