IHI appoints architects to assess Prague property’s development potential after master plan change

International Hotel Investments plc (IHI) has appointed architects and professional advisers to assess the full development potential of its landmark Grand Hotel Prague, following a major change to Prague’s planning framework.

IHI, which is a real estate investor, developer and operator, focusing primarily on luxury hotels and its proprietary Corinthia brand, said that this Prague planning framework change has significantly improved the site's redevelopment potential, and therefore the prospective value of the property.

The Metropolitan Plan was recently approved by the Prague City Council and comes into effect on 1st September. It permits the potential conversion of the landmark high-rise 60,000 sqm property to residential use and allows for additional development volume on the hotel’s adjoining vacant land.

Together, these changes significantly broaden the development opportunities for the site. IHI’s assessment of the site’s development potential will also establish an updated valuation benchmark reflecting the enhanced development parameters.

The new masterplan for Prague unlocks significantly greater potential for the site and consequently has capacity to enhance its underlying value, a spokesman for IHI plc said. “This is a very positive development which gives us the opportunity to reassess the property’s development potential and valuation to appeal to a broader target pool of developers and investors.”

The re-evaluation of IHI’s Prague hotel could potentially include an asset sale, which forms part of IHI plc’s broader strategy of realising value from its owned real estate portfolio, while increasingly expanding its Corinthia hotels and estates brand internationally through an asset-light hotel management model, particularly within the luxury segment.