A London judge is set to decide on a dispute between Lebanese hotelier Boutros El Khoury and UK lender Cohort Lendco II over two Hilton-branded hotels. El Khoury claims the lender frustrated his attempts to buy and repay the debt, then had him removed from the building. The lender denies all allegations. The case involves £94.5m in debt and has implications for South African capital invested in UK property. El Khoury bought the company owning the hotels for £1, just before administrators were appointed.
El Khoury purchased the company owning the Hampton by Hilton hotel at London's Waterloo and the DoubleTree by Hilton in York in June. He paid £1 for the shares of a business carrying heavy debt. Eleven days later, administrators appointed by Cohort Lendco II removed him from the Waterloo hotel, citing interference with its operations. The lender's actions have been questioned, with El Khoury's barrister arguing that Cohort's goal was to push the debt to a level that only they could meet.
The court heard that the company failed to repay Cohort's £94.5m loan in November 2025, and default interest began running at about £2m a month. El Khoury offered £108m for the Waterloo hotel early in the year but was shut out after disputes over proof of his funds. His barrister argued that Cohort was "sitting on a much, much higher value asset" and that the delays were designed to increase the debt.
A key point of contention is a R22m (£1m) payment demanded by Cohort's chief executive, Matthew Thame. The court heard that Thame advised the company's then-director to demand a non-refundable "exclusivity" payment in the memorandum of understanding, despite a parallel sale process run by agents JLL. Thame admitted that demanding such a payment from a bidder outside an ongoing sale process was abnormal.
El Khoury offered a £5m deposit held by solicitors, later raised to £10.8m, 10% of his offer, and provided bank statements and term sheets. However, he was redirected into the formal JLL process instead, roughly three months after negotiations began. At one point, he wrote to the lender pleading for a decision. His barrister suggested that Cohort's actions were motivated by a desire to profit from the deal.
Cohort's defence maintains that they were "completely impartial" as to who bought the hotel and were "100% interested in redeeming our debt". Thame denied that forcing the company into administration was their intention. The judge has reserved judgment to a later date, and the outcome will have implications for UK property lending, particularly for unregulated lenders.
The case highlights the mechanics behind a growing share of UK property lending at a fragile moment. Values have fallen since the Gulf conflict, and defaults are spreading. South African capital sits inside this gap, and the ruling will be the first time a British judge maps this territory in a live case. The outcome will determine what a lender may do with its consent rights while the meter runs and where lending ends and acquiring begins.
Key points
- The dispute involves £94.5m in debt and has implications for South African capital invested in UK property.
- The lender, Cohort Lendco II, is part of Cohort Capital, a Mayfair-based bridging firm not authorised or regulated by the Financial Conduct Authority.
- The judge's ruling will have implications for UK property lending, particularly for unregulated lenders and the treatment of borrowers.
