Another 50 rooms are to be added to “The Caley” hotel after it was snapped up by the Abu Dhabi-based hospitality investment giant Twenty14 Holdings for £85 million.
A £20m programme is to be rolled out over two years from 2019 by the firm, which has pledged to create 100 jobs at the Caledonian Hotel, which dates back to 1903.
Twenty14 Holdings – which described the Edinburgh landmark as “Scotland’s most distinguished hotel” – said the forthcoming work would expand its “character and elegance”. The company already has a portfolio of hotels and developments in Dubai, London, Oman and India.
The hotel, which has been visited by famous names including Charlie Chaplin, Elizabeth Taylor, Bing Crosby and Sir Sean Connery, will continue to operate under Hilton’s Waldorf Astoria brand.
The sale of the 241-room hotel, which overlooks Edinburgh Castle from its site at the west end of Princes Street, has been revealed six years after a previous £24m makeover.
The Caley, which has been operated by the Hilton chain for the last 18 years, started life as a “railway hotel” next to the then Princes Street station.
Adeeb Ahamed, managing director of Twenty14 Holdings, said: “We are excited to add The Caledonian to the portfolio of Twenty14 Holdings. With more than a hundred years of history, it brings with it a rich heritage, character and unique opulence.
“We’re honoured to be part of this Scottish landmark that has a great connect with the locals and visitors alike. We look forward to adding to the experience The Caledonian already offers.”
The purchase of The Caley is the biggest hotel deal in Scotland since the Gleneagles resort in Perthshire was snapped up in 2015.
Will Duffey, executive vice-president of hotels and hospitality at JLL, which handled the sale, said: “Our client’s recent refurbishment programme repositioned the hotel to its former glory when it reopened as the first Waldorf Astoria in the UK in 2012. We’re delighted to have advised on this irreplaceable trophy hotel to an investor who will preserve and protect this most important of assets.”
Grand railway hotels had been appearing all over Britain for over quarter of a century.
The original Caledonian Hotel was created as part of Princes Street Railway Station in direct response to the development of the North British Hotel (now The Balmoral), which had opened the previous year.
Construction began on The Caley in 1899 and was complete by 1903 – a year after the Caledonian’s bitter rivals had opened the North British to serve Edinburgh Waverley.
The Caledonian Hotel was built directly above the existing V-shaped station building and towered high over the main shed. Railway passengers were able to gain entry via what is today the entrance to the Caley Bar.
The nationalisation of Britain’s railways and the subsequent Beeching cuts forced the closure of the station in 1965, allowing the hotel to be extended over part of the former concourse.