The robust investment appeal of UK holiday parks has been highlighted by the sale of a 40 acre development site in North Wales to Darwin Leisure Development Fund.
Plas Isaf Lodge Park, which is located in a woodland setting to the south of the Flintshire town of Caerwys, has planning permission for 57 holiday lodges of which 12 have already been constructed. It was sold for an undisclosed price, which was agreed prior to lockdown and will join the ‘Darwin Escapes’ portfolio of 22 lodge resorts and holiday parks around the UK.
Ben Jones, director in the Parks & Leisure team at global real estate advisor Colliers International, which acted on behalf of the private vendor, said:
“The completion of the sale of Plas Isaf, at a price agreed pre-lockdown without any adjustment, confirms confidence in the UK holiday parks market as an alternative asset class.
“This is a sector that was already showing impressive growth prior to the outbreak of COVID-19, and it now looks set to bounce back strongly following the disruption caused by lockdown.
“Holiday parks are ideally suited for maintaining social distancing measures, as they provide self-contained accommodation that is subject to minimum spacing requirements, and are surrounded by plenty of fresh air and recreation space.
“Not surprisingly, they are experiencing strong visitor demand as ‘staycations’ gain in popularity among UK holidaymakers, who are increasingly choosing to enjoy a break in this country instead of going abroad. This is being reflected by keen interest that we have been receiving from existing operators and new entrants keen to purchase holiday parks and capitalise on what is expected to be a growth sector.”
Darwin Leisure Development Fund is a specialist fund that focuses on investing in holiday parks. Investors include a number of UK local authority pension funds and it has recorded an annualised return of 8.09% for the three years to 30 June 2020*.
Anthony Esse of Darwin Alternative Investment Management Limited, the investment advisor to the Fund, said:
“Plas Isaf is a beautiful lodge resort in an idyllic setting and we are delighted that it will join the four other Darwin Escapes locations in North Wales. Whilst the past few months have been challenging for all operators, demand for UK staycations has surged and confidence in the market is strong.
“We intend to invest in the Plas Isaf site to maximise the planning permission that is already in place and ensure that Plas Isaf becomes one of North Wales’s leading luxury lodge resorts.”
The sale of Plas Isaf Lodge Park comprised the entre share capital in the owning company. The business, which was owned and operated by the private vendor, also includes owner’s accommodation in a four-bedroom farmhouse with extensive grounds; a former mill with planning permission for conversion into a three-bedroom holiday cottages; and a range of traditional stone barns with planning permission for conversion into three two-bedroom holiday cottages.