Middle East investors eye old Scotland Yard hotel plans

Galliard, the largest private housebuilder in the capital, purchased the Edwardian, grade II-listed site, which was once home to Scotland Yard and then the Ministry of Defence, in December 2013, with the intention of transforming it into a luxury hotel.

Galliard’s construction project, which began in January and is also funded by The Crown Estate, is estimated to cost £50m and will run for 26 weeks. Plans for the seven-floor building, which featured in the 2007 film Atonement, with Keira Knightley and James McAvoy, include 235 bedrooms, a VIP suite, a vast ballroom and a high end restaurant.

This development is part of the transformation of government buildings in Whitehall to residential and leisure addresses. The Corinthia Hotel on Whitehall Place was a former political stronghold, and Admiralty Arch on The Mall is also being converted into a hotel.

The London hospitality scene is attracting foreign investment due to its occupancy rates, which are among the highest in the world at 81pc, compared with 79pc for Dubai and 78pc for Paris.

“Despite a spate of high profile openings, there also remains an undersupply of five-star hotel accommodation in Whitehall and Westminster. Of the supply growth since 2005, only 14pc of new rooms and suites have been high end accommodation, the rest has been budget or 3/4 star rooms,” said central London property agent Peter Wetherell.

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