Delancey is pleased to announce that it has formed a joint venture partnership with two leading names in the independently managed hotel sector to establish Hilwood Resorts and Hotels ("Hilwood"), a new company which will aim to acquire and operate a portfolio of hotel investments in the premium four and five star areas of the UK hotel sector.

Delancey's experience in real estate and funding will complement the hotel and management skills of Hilwood's new joint managing directors, Gregor Ritchie, most recently former Operations Director of Hand Picked Hotels Limited, and Arvinder Walia, former Group Finance Director of Hand Picked Hotels Limited.

Hilwood will aim to create a high-end signature brand targeting a range of market categories, including corporate, conference and family as well as catering specifically to those seeking quality spa, food and beverage experiences. The joint venture will look to acquire UK assets, in either city or provincial locations, which offer the potential to generate a spectrum of revenue streams. Target assets will comprise a minimum of 70-100 rooms with the potential for expansion and possible repositioning as premium four or five star hotels.

Today, Hilwood is also pleased to announce its first acquisition, The Grand, St Helier, Jersey, from The De Vere Group plc for £15.5m. The property is situated in the centre of St Helier and comprises 118 bedrooms, a 150-seat restaurant, a large ballroom, bar and lounge areas and a health and fitness area. Works will commence in October 2006 to provide a comprehensive refurbishment of the hotel's rooms, spa, restaurant and business facilities. The hotel will remain open during the refurbishment programme.

Jamie Ritblat, Chief Executive of Delancey, commented:

"We have been interested in this market for some time and are delighted to have formed a partnership with Arvinder and Gregor. We are confident that their excellent track record in building and managing a hotel portfolio, supported by Delancey's complementary real estate and property financing expertise, will provide Hilwood with exciting dynamic and strong foundations. Having already acquired our first asset, we look forward to working together to rapidly grow Hilwood into a leading brand in the UK hotel industry."

Hilwood joint managing director, Gregor Ritchie, commented:

"Delancey has an established and respected reputation of working with specialist teams in joint venture partnerships and our combined expertise should enable us to identify and unlock a range of exciting opportunities. We look forward to building the portfolio and adding value through our joint asset management skills, carving out a sophisticated signature brand combining the very best facilities and service at the high-end of the market place."

For more information, please contact:

Sally Hands
Delancey
Tel: +44 (0)20 7448 1448

Dido Laurimore/Stephanie Highett
Financial Dynamics (for Delancey)
Tel: +44 (0)20 7831 3113

Delancey

Delancey provides real estate related advisory and management services to a variety of clients in respect of a broad range of assets varying from individual property investments and developments throughout the UK to corporate investments. The Group's investment strategies are based upon four fundamental criteria: of underlying quality of assets, liquidity, provision of stable cashflows and capital growth potential.

Biographies

Arvinder Walia

Arvinder has a background in private equity and corporate finance at board level and joins Hilwood from Hand Picked Hotels Limited ("Hand Picked"), owned by Guy Hands of Terra Firma Capital Partners.

Arivinder has been Finance Director of Hand Picked since 2001, working across a portfolio of 15 high-end luxury hotels and five health clubs and spas. During his time at Hand Picked, Arvinder was responsible for strategic business planning, including the creation of a five-year investment plan and a debt restructuring. His remit also took in the management of the group's banking and investor relationships, including all commercial and legal contract negotiations.

Prior to joining Hand Picked Hotels, Arvinder worked as Regional Director for Aberdeen Murray Johnstone Private Equity, part of Aberdeen Asset Management plc, a leading Scottish fund management house. Before this, Arvinder worked in corporate finance for Coopers & Lybrand in Nariobi and London.

Gregor Ritchie

Gregor has a strong background in hotel management and also joins Hilwood from Hand Picked Hotels Limited, where he has worked as Operations Director since 2001.

During his time at Hand Picked, Gregor was responsible for the initiation, development and implementation of the strategic direction, service and standard ethos of the company's five-year investment plan. Gregor helped to re-position the portfolio as a luxury hotel market operator, securing recognition in the form of various awards, including The AA Hotel Group of the Year award 2004-2005 and the BHA Business Excellence award 2005 for best group management.

Prior to joining Hand Picked, Gregor worked in a range of hotel management positions in premium four and five star hotels throughout the UK.