£90m Cambridge landmark refinanced

26 Mar 2025 | 08:15 | London | by Chris Borland

What Melford Capital has refinanced University Arms, Cambridge’s oldest hotel
Why A sale had been explored before the owner settled on a ground rent-led refinancing structure
What next M&G, Leumi and Martley Capital now join Melford in capital stack

Melford Capital has refinanced and added a ground rent structure to the oldest hotel in Cambridge, Green Street News can reveal.

Melford Capital had been exploring the £90m sale of the University Arms hotel. However, it has instead locked in a ground rent deal, new senior debt and a mezzanine facility.

M&G Real Estate has acquired the freehold interest of the oldest hotel in Cambridge, with Melford committing to a ground lease. Specialist real estate lender Leumi has provided a senior loan, while Martley Capital in partnership with Glade Capital have topped up the new capital stack with a mezzanine facility.

University Arms, which has around 190 rooms, is part of Marriott’s Autograph Collection.

Fresh capital stack

Having acquired the asset in 2012, Melford Capital invested around £80m – a figure that incorporates site acquisition and refurbishment costs – in restoring the hotel to its former glory, after the site lapsed into decay.

Architect John Simpson and interior designer Martin Brudnizki worked with Melford to reinvigorate the property, using around 500 tonnes of Lincolnshire limestone in the rebuild.

The hotel successfully reopened in 2018. It comprises 10 suites, each named after a figure connected with Cambridge.

JLL advised Melford Capital. All parties declined to comment. Click here to read the full article.