PPHE Hotel Group disclosed unaudited results for the six months ending June 30, 2026, reporting increased revenue and EBITDA, driven primarily by strong operational trading in the United Kingdom and growth in meetings and events. Average revenue per available room (RevPAR) rose 3.1% on a like-for-like basis, supported by a 3.2% increase in room rates, while occupancy levels remained stable at 72.5%.
In the UK, total revenue expanded 6.8% with RevPAR growth of 5.2%. The first quarter saw an 8.8% increase in UK revenue, followed by a 5% rise in the second quarter. The enhanced performance included contributions from the
ramp-up of art’otel London Hoxton and a robust pipeline of large meetings and events. Other regions showed mixed results: Croatia’s leisure portfolio underperformed due to closures in the first half, Germany’s like-for-like revenue was flat though sterling revenue increased 2.9%, while Dutch hotel revenue declined 5.3% in local currency following a VAT increase on hotel bedrooms from 9% to 21%.
Adjusted EPRA earnings over the rolling 12 months ended June 30 held steady at £53 million, or £1.25 per share, with interest costs rising after refinancing. The company declared an interim dividend of 17 pence per share, unchanged from the
prior year. Net debt rose to £932 million from £775 million at year-end 2025, reflecting the acquisition of the Park Plaza London Waterloo freehold. This purchase, totaling £156 million including expenses, was funded by a new five-year £136.5 million loan facility and increased the group’s loan-to-value ratio to 39.5% from 35%. The average debt maturity stands at 4.4 years, with an average cost of debt of 4.4%. The Waterloo loan carries a five-year term with 90% fixed for two years at an interest rate of 5.9%.
Significant asset transactions included reacquiring the Park Plaza London Waterloo freehold for £147.9 million,
reversing a 2017 sale-and-leaseback agreement where the asset was sold for £161 million with a 200-year leaseback at escalating rent levels. PPHE repurchased the freehold at a 4.9% capitalization rate, £13 million below the previous sale price, halting EBITDA erosion caused by rent increases and simplifying the balance sheet. The company also sold its New York development site for $33.5 million after regulatory changes rendered development unviable. Proceeds from the sale will first repay associated debt, with remaining funds allocated to other geographies.
PPHE refinanced art’otel Rome with a €27.6 million five-year facility and is preparing to launch 5,000 square
meters of office space at art’otel London Hoxton under the One Rivington co-working concept, scheduled to open by mid-November 2026. Capital expenditures included investments at Leman Street, Park Plaza London Park Royal, and Park Plaza London Waterloo. The group’s rolling 12-month free cash flow was £76 million, out of which £17 million funded dividends and £26 million covered bank loan repayments and capital expenditure.
The company paused progress on UK land-bank development projects located at Westminster Bridge Road, the A40, and Leman Street, citing challenging economic and operational conditions. Factors affecting UK development include heightened business rates, national insurance costs,
employment-law pressures, supply-chain difficulties, and unfavorable returns on investment. PPHE management described the UK as a “challenging market to deliver future value for shareholders.”
A strategic review initiated in November 2025 to maximize shareholder value concluded in July 2026 without a firm offer after Fattal Hotel Group withdrew its proposed £22 per share bid due to loss of support from PPHE’s largest shareholder, Euro Plaza Holdings. Management credited the process with informing future value creation and operational priorities despite the bid’s withdrawal.
PPHE continues to pursue opportunities from maturing assets, particularly at art’otel London Hoxton and the forthcoming co-working space
launch. City-center locations in the UK maintained or improved their performance heading into the second half of 2026, while Croatia showed improving momentum during the summer season.
