Investment. Structure, capital range, and equity offer.
The working note on the corporate structure, the total capital requirement, the Parker family's own contribution, and what would be offered to external investors. All figures here derive from the modelled Forecast; the equity ranges are indicative and need to be firmed up with a corporate finance advisor before any conversation with an investor.
Two companies. Property in the family entity, operations investable.
The proposed structure separates the physical asset from the operating business. Hotel de France Group Ltd — the existing Parker-family holding entity — retains ownership of the building, the land and every other property-based asset (the Mallard, the Elinor Ruth Medical Centre, Healthhaus). A new company, The Long Group Ltd, is created as the operating vehicle for the longevity business and any future Long-branded properties. Investors take a percentage of The Long Group Ltd; they do not get any interest in Hotel de France Group Ltd or the underlying property.
Why this shape.
- Property income in Jersey is taxed at 20%. Hospitality trading income is taxed at 0% under the general rate. A rent charged between HdF Group (property) and The Long Group (operations) would create a taxable property income stream while reducing the tax-free hospitality profit by an equal amount — pure value destruction. Leasing the building at £0 on a long lease keeps operating profit in the 0%-tax vehicle where investors have their exposure.
- The building stays with the family. The property has been in the Parker family for decades and continues to appreciate independently of the longevity business. Investors buy into the operating growth story, not the underlying land — which is how they will want it (property is a different asset class with different holding periods and return profiles) and how the family will want it (the freehold is not on the table).
- Future locations don't need restructuring. Naming the vehicle The Long Group rather than The Long Hotel means Long Club London and any subsequent properties sit as subsidiaries under the same holdco. Investors get proportionate exposure to the platform, not to a single asset. If a later round funds London specifically, terms can be structured at that level without disturbing the Jersey capitalisation.
- 20-year lease at £0, unbroken term. A flat 20-year committed term with no renewal decision to negotiate. Matches the amortisation profile of the £11-18M renovation capex investors help fund (UK Outer London construction base + bulk Jersey uplift), so there is no "capex outlasts the lease" gap to explain away. Standard commercial lease termination provisions (material breach, insolvency, change-of-control) sit in the boilerplate as they would in any 20-year hospitality lease, giving both sides normal protections. Codified in the lease at the same time as the shareholders' agreement.
Staff accommodation — how the salary-sacrifice arrangement survives the split.
Today, staff who live in company-owned accommodation (Rosebank, and the other Parker-owned staff housing) have rent deducted from their salary before income tax — the arrangement effectively delivers the accommodation as a Benefit In Kind, so staff get housed and their tax bill is reduced by the tax on the rent-equivalent value. That arrangement works because the same entity both employs the staff and owns the accommodation. Splitting employment (The Long Hotel) from ownership (HdF Group) risks breaking it — a naïve split would create 20%-taxed property income at HdF, an income tax bill on the full salary at the employee, and no BIK offset. The following structure preserves the current benefit for everyone:
- HdF Group leases the staff accommodation to The Long Hotel at £0, on the same long-lease basis as the hotel property itself. This keeps HdF's property-income line at nil for staff housing (avoiding the 20% Jersey property tax on that income) and puts the accommodation into the operating vehicle's hands to allocate.
- The Long Hotel then provides the accommodation to eligible staff as a Benefit In Kind, with the rent-equivalent value deducted from gross salary before income tax — exactly the current arrangement, just with The Long Hotel as the employer entity instead of HdF's operating entity. Staff experience is unchanged: same tax benefit, same accommodation, same net take-home.
- The salary-sacrifice cash retained by The Long Hotel offsets the notional cost of providing housing. Small figure at the level of the whole-hotel P&L; it appears as a modest reduction in the effective wage line rather than as its own revenue stream. Genuinely neutral to the operating economics.
- Comptroller of Taxes exposure needs a specific sign-off. A £0 lease between related parties is defensible when the commercial substance is documented — HdF's ongoing property maintenance, the capital investment obligations The Long Hotel takes on, and the structural rationale of keeping operating profit in the 0%-tax vehicle. The staff-accommodation extension of the £0 lease principle should be scoped by the same Jersey corporate lawyer drafting the main lease. Provided the commercial substance holds, the arrangement should stand — but it needs formal opinion before an investor's diligence team lands on it.
Staff: unchanged. Same accommodation, same tax benefit, same net pay.
HdF Group Ltd: no property-income tax charge on staff housing (matches the hotel-lease treatment); no direct cash from rent, but no incremental cost either.
The Long Hotel: the salary-sacrifice offset appears as a modest wage-line reduction. Free to allocate staff accommodation to whichever hires most need it, without a related-party rent negotiation between entities every time an allocation changes.
Investors: see clean operating economics inside the 0%-tax vehicle, with no property-income leakage or complicated related-party rent flows to interrogate.
The Parker contribution. Cash plus considerable in-kind value.
Before any external investor commits a pound, the Parker family is contributing both cash (upfront and ongoing) and a large stack of in-kind value to The Long Group. Total Parker cash commitment across the ramp-up runs to £5.7M – £6.75M depending on how long the ongoing contribution continues; the in-kind portion of ~£18M is what makes the Parker family's ownership stake substantially larger than the cash figures alone would suggest, and it is the reason the equity offered to investors sits meaningfully below what a cold-start £11-17M raise would ordinarily command.
Cash contribution.
Parker family cash comes in two layers:
| Source | Nominal | Timing |
|---|---|---|
| Committed capital, drawn on a schedule 2026-2029 — ~£4.1MNot all in the account on Day 1 — realisations land as capex calls arrive across the build. Only ~£1.73M is available in 2026; the £1.4M Lodge sale lands in 2027; the £1M Guernsey second tranche in 2029. If launch runs Y1 2028, the 2029 tranche arrives during ramp-up and effectively cushions early working capital rather than funding capex | ||
| Sale of Westview flatParker-family property sale directed at The Long Hotel | £728,000 | Available |
| Guernsey Development — first trancheFamily investment realisation | £500,000 | September / October 2026 |
| Sale of Turkey propertyParker-family property sale directed at The Long Hotel | £500,000 | By end of 2026 |
| Sale of The LodgeParker-family property sale directed at The Long Hotel | £1,400,000 | By end of 2027 |
| Guernsey Development — second tranche | £1,000,000 | By 2029 |
| Upfront — NPV at 8% discountreflects timing of realisations 2026-2029 (Westview available now; Guernsey tranches, Turkey and The Lodge staggered). Near-term calls take minimal discount; the £1M 2029 tranche is the largest discount | ~£3.79M | Present value |
| Ongoing operating capital — ~£530k/year across the ramp-up (first 3-5 years) | ||
| Parker family other businessesOperating cash flow from other Parker-family business interests, directed at The Long Hotel during the ramp-up period | ~£500,000/yr | First 3-5 years |
| HdF Group surplus routed via Healthhaus structureAny HdF Group surplus after servicing the pre-existing property debt (~£665k/yr) and property carrying costs is routed to The Long Hotel as additional Healthhaus spa-facility payment rather than left at HdF (see structuring note below the table). Economically a Parker family capital contribution — recorded here, not as operating revenue in the Forecast P&L. Modelled at ~£30k/yr; actual amount depends on HdF's realised property-cost position each year | ~£30,000/yr | Across the ramp |
| Ongoing — nominal across the ramp-up3 years £1.59M · 5 years £2.65M | £1.59M – £2.65M | Across the ramp |
| Ongoing — NPV at 8% discount£530k/yr taken at end-of-year over 3 to 5 years — the same NPV treatment applied to the £0 lease valuation below | £1.37M – £2.12M | Present value |
| Total Parker cash contribution — nominal | £5.7M – £6.75M | Upfront + ramp-up |
| Total Parker cash contribution — NPV at 8% | ~£5.16M – £5.91M | Upfront + ramp-up |
The upfront ~£4.1M (~£3.79M on an NPV basis, given the staggered realisation timeline) is committed as equity into The Long Group Ltd at the same terms as external investors, drawn against capex and working-capital calls rather than paid in on Day 1. The ~£530k/yr of ongoing capital (£500k from other Parker businesses + ~£30k HdF surplus routed through the Healthhaus structure — see structuring note below) is structured as additional Parker capital contribution across the ramp-up years — meeting working-capital calls as they arise, reducing the external cheque size and the corresponding equity dilution. Whether these ongoing contributions rank pari passu with the initial round or take a different security position is a governance detail for the shareholders' agreement (typically pari passu at the same subscription price to keep the cap table clean).
Note on ERM and Healthhaus. The ~£400k/yr Elinor Ruth Medical Centre tenant income and ~£320k/yr net Healthhaus rent (£400k gross less ~£80k passed to The Long Hotel to reimburse it for the electricity and cleaning of the Healthhaus space) are received by HdF Group as property owner. They are not channelled into The Long Hotel as additional Parker capital — they stay at HdF to service the ~£665k/yr of pre-existing debt secured against the building. That reallocation moves a real cost off The Long Hotel's P&L (see the Forecast's finance-costs note), which more than offsets the reduction in ongoing Parker capital.
The mechanics. After HdF Group services the ~£665k/yr of pre-existing debt and its property carrying costs (insurance, structural maintenance, freehold management), any residual surplus on the ERM + Healthhaus rent income is economically Parker family capital — HdF is Parker-owned 100%. That surplus is intended to flow to The Long Hotel to support the ramp-up, but sending it as a straight HdF-to-Long-Hotel intercompany transfer would first crystallise as HdF property profit and attract Jersey's 20% property income tax charge, leaving only 80p per pound to reach the operating vehicle.
The fix. Rather than letting the surplus land at HdF as taxable profit, the Healthhaus payment is structured so that the amount HdF needs is booked as rent to HdF (covering debt service + property costs, sized to leave HdF at approximately zero taxable property profit), and the balance is booked directly as spa-facility payment to The Long Hotel. From The Long Hotel's side this looks like an operating receipt from Healthhaus; from an economic-substance standpoint it is a Parker capital contribution routed through the tax-efficient channel.
Why it sits on this page and not in the P&L. Because the substance is capital contribution rather than operating trading, the ~£30k/yr is recorded here on the Investment page (alongside other Parker ongoing capital) and deliberately kept out of the Forecast P&L, so the reader sees operating performance separately from the capital that supports it. If a diligence team wants to test the arrangement, the Jersey corporate lawyer drafting the £0 lease and the staff-accommodation BIK should scope this alongside — same substance-over-form principle, same Comptroller-of-Taxes sign-off pathway.
Ongoing capital, on an NPV basis.
The ongoing ~£530k/yr contributions (£500k from Parker other businesses + ~£30k HdF surplus routed via Healthhaus) aren't cash in the account on Day 1 — they arrive over the following 3-5 years as calls are met. Applying the same NPV treatment used for the £0 lease valuation (money in the future is worth less than money today), the ongoing Parker capital is worth less than its nominal £1.59-2.65M as a Day-1 contribution to the cap table:
| Ongoing term | Nominal | NPV at 5%property-owner rate — favours Parkers | NPV at 8%mid-range — standard | NPV at 10%operator rate — favours investors |
|---|---|---|---|---|
| 3 years × £530k/yr | £1.59M | ~£1.44M | ~£1.37M | ~£1.32M |
| 4 years × £530k/yr (midpoint) | £2.12M | ~£1.88M | ~£1.75M | ~£1.68M |
| 5 years × £530k/yr | £2.65M | ~£2.29M | ~£2.12M | ~£2.01M |
Total Parker cash NPV at 8% discount: ~£5.16M – £5.91M (was £5.7M – £6.75M nominal), midpoint ~£5.54M. The upfront £4.1M is ~£3.79M on a present-value basis (staggered realisations 2026-2029); the £1.37M – £2.12M of ongoing NPV replaces the £1.59M – £2.65M of nominal ongoing capital in the pre-money calculation.
The NPV haircut is modest (~£400k at the midpoint) because 4 years isn't that long a deferral. The point isn't the size of the adjustment — it's consistency: we discount the lease NPV, we should discount the deferred Parker capital by the same logic.
In-kind contribution.
Everything below already exists or is already committed. Investors would face all of these as build-from-zero costs at an independent competitor; here they are pre-existing platform value:
- The buildings, on a 20-year lease at £0. The 72-suite hotel property (valued at ~£20M) plus Rosebank staff accommodation (~£3.5M) — £23.5M of property put into rent-free use for 20 years. At market investment yields specific to each asset class (Hotel 6.5%, Rosebank 5.5%), arm's-length market rent on the two properties works out to: Hotel: £20M × 6.5% = £1.30M/year Rosebank: £3.5M × 5.5% = £192,500/year Combined: £1.49M/year This is where the bulk of the in-kind value sits.
- Fifty-five years of operating history under Parker-family ownership (Hotel de France acquired in 1971). Systems, staff, supplier relationships, licensing, planning consents, established procurement contracts, decades of institutional relationships across the Jersey hospitality sector. A greenfield competitor spends 18-24 months building the equivalent from scratch — most of which is spent burning capital.
- The Ayush Spa 20-year client list. Approximately 2,000 active local contacts, the highest-ROI acquisition channel identified anywhere in the model. Cold-acquiring an equivalent Jersey-based longevity-adjacent list at CPA parity would cost ~£300-500k in marketing spend.
- Existing staff of ~85 employees. Trained, on-payroll, and in most cases moving with the business into the new proposition. Cost of a full replacement hire cycle: ~£200-300k in recruitment fees and onboarding time.
- Named clinician relationships already secured. Dr Shiv Chande (Medical Director), Dr Prasanna Kerur (Ayurvedic, existing hotel employee), Dr Alexa Kerr (Kanti aesthetic), Dr Marie-Christine Dix (Klesha stream). Recruiting a comparable team on the open market would take 6-12 months and cost £30-60k in search fees.
- The brand. The Long Hotel identity, the Long Club membership concept, the Long View programme naming, the Sanskrit taxonomy across the Sama Clinic — trademark-registrable and transferred to The Long Group Brand Ltd at nil cost.
Valuing the £0 lease honestly.
The lease is worth what The Long Group avoids paying to lease equivalent property arm's-length — 20 years of avoided rent for each property, discounted for time and risk. Each property is valued at its own market yield (hotel and staff residential are different asset classes with different risk profiles), so each is computed separately and added together.
Money today is worth more than money in the future — either because of inflation, opportunity cost (what you could earn on it elsewhere), or risk that the future payment doesn't arrive. A discount rate converts a stream of future payments into a single "worth today" figure. The higher the discount rate, the less those future payments are worth in today's money.
Property-owner cost of capital ~5% is what a wealthy family owner like the Parkers can safely earn on invested capital — a defensible mid-range opportunity cost of money for the Parker balance sheet. Note this is different from the market yields (6.5% hotel, 5.5% Rosebank) that were used above to set the arm's-length rent figures — those yields translate an asset value into an annual rent; the discount rate translates that rent stream back into a present value. Using the yield as the discount rate would be circular; using the family's opportunity cost is the honest measure.
Operator cost of capital (~10%) is what investors in The Long Group demand for taking on operating-business risk. Operating a longevity hotel is genuinely riskier than owning a building, so the required return is higher.
Where you sit on that spectrum determines what the lease is worth: the property-owner rates inflate the NPV modestly (favours the Parkers in negotiation); an operator-friendly 10% deflates it (favours investors). 8% is the standard middle ground a corporate finance advisor would default to for a blended answer.
The undiscounted total of avoided rent is a simple sum: £1.30M × 20 years for the hotel = £26.0M nominal. This is the total cash rent the venture avoids paying over the lease period.
The NPV is what those same payments are worth as a single lump sum today, discounted for the time value of money. Year 20's £1.30M is worth only £0.49M today (at a 5% discount rate — because if you had £0.49M today, you could grow it to £1.30M by year 20). Summing all 20 discounted years gives NPV.
For valuation purposes NPV is the standard, because an investor's diligence would immediately discount an undiscounted headline as overstated. Both numbers are shown below so the discounting effect is transparent — you can see exactly how much "time value" is being subtracted at each rate.
Hotel — £20M × 6.5% yield = £1.30M/year rent avoided over 20 years
Undiscounted 20-year total: £26.0M nominal. NPV at various discount rates below:
| Discount rate | NPV | vs £26M nominal | Whose perspective |
|---|---|---|---|
| 5% | ~£16.20M | −£9.80M | Property owner's cost of capital (a defensible mid-range opportunity cost for a wealthy family owner) — favours the Parkers |
| 8% | ~£12.76M | −£13.24M | Mid-range, defensible against both perspectives |
| 10% | ~£11.07M | −£14.93M | Hospitality operator's cost of capital — favours investors |
Rosebank — £3.5M × 5.5% yield = £192,500/year rent avoided over 20 years
Undiscounted 20-year total: £3.85M nominal. NPV at various discount rates below:
| Discount rate | NPV | vs £3.85M nominal | Whose perspective |
|---|---|---|---|
| 5% | ~£2.40M | −£1.45M | Property owner's cost of capital (same 5% as the hotel — one family, one opportunity cost of capital) — favours the Parkers |
| 8% | ~£1.89M | −£1.96M | Mid-range, defensible against both perspectives |
| 10% | ~£1.64M | −£2.21M | Operator cost of capital — favours investors |
Combined lease value (Hotel + Rosebank)
Undiscounted 20-year total: £29.85M nominal (Hotel £26.0M + Rosebank £3.85M). Present value at various discount rates:
| Discount view | Hotel NPV | Rosebank NPV | Combined NPV |
|---|---|---|---|
| Property-owner 5% (both assets) | £16.20M | £2.40M | ~£18.60M |
| Mid-range 8% (both assets) | £12.76M | £1.89M | ~£14.65M |
| Operator 10% (both assets) | £11.07M | £1.64M | ~£12.71M |
Estimated Parker in-kind contribution: £15.71M – £22.60M, driven mostly by the 20-year combined lease NPV of £12.71M – £18.60M (per the tables above — the £12.71M floor is the 10% operator cost-of-capital discount, the £18.60M ceiling is the 5% property-owner opportunity cost of capital applied to both assets), plus ~£3.00M – £4.00M for the operational goodwill, brand IP, Ayush list, existing 85-person staff and management contribution stacked on top.
Combined with the £5.16M – £5.91M Parker cash commitment on an NPV basis (£3.79M upfront NPV + the NPV of the ongoing ~£530k/yr contributions), the Parker family enters the capitalisation table with a fair-value contribution of £20.87M – £28.51M, working midpoint ~£23.70M pre-money (using the 8% mid discount rate + 4-year ongoing NPV + midpoint intangibles). This is the anchor for the equity split below.
What the venture actually needs. Range £13.75M – £22.38M.
The total capital needed to open the doors and carry the business through to sustainable operating profit sits in a range depending on two variables: the scope of the physical build (leaner vs fuller premium finishes across all guest-facing spaces, including the Kala artist workshop room + paired editing studio if the artist-in-residence programme is funded) and how much working-capital buffer is held for the Year 1-2 loss trough. The two lines below net to the range set out on the Forecast's upfront capex table plus the cash working-capital line that sits below it. Range now includes the indicative driveway paving estimate (buff clay pavers, ~2,000 m², ~£670k-£880k — specialist paving contractor quote pending) and the bulk Jersey uplift line on the construction subtotal (+~£1.23M-£2.77M) recently unbundled from the per-line rates — see the Renovation page's SPONS callout for the split between UK Outer London construction base and the +15-22% Jersey/CPI premium. Numbers will firm once the paving contractor quote and BdV-informed Jersey factor come in.
| Line | Low end | High end |
|---|---|---|
| Upfront capex Renovation of the whole hotel (72 suites of which 15 are South Wing corporate long-stay studios, spa wing expansion 8→10 rooms, Ahara relaunch, Sama Clinic fit-out, Bala Gym, lobby cafe, Aram lounge, Sandhana ferment cellar, Siksa fermentation classroom, Kala artist workshop room + paired content editing studio) at the UK Outer London construction base plus the bulk Jersey uplift line (+~£1.23M-£2.77M on the construction subtotal); Sama Clinic + wellness equipment (DEXA, Kanti aesthetic suite, Kaya rig, Orion beds across all 72 suites, cryotherapy chamber, Kala live-stream AV + editing suite); £187k of launch content and software; plus 10% portfolio contingency. Full breakdown on the Forecast. | £13.05M | £20.88M |
| Working capital + Y1-Y2 operating loss Cumulative pre-tax loss bottoms at ~£1.26M at end-Year 2 (default view, all optional levers on). Adding back non-cash amortisation of ~£1.04M over Y1-Y2, the cash working-capital requirement is ~£220k. The line below adds a conservative buffer for Y0 timing, cost overruns and delayed guest arrivals, up to ~£1.5M at the high end. | £0.7M | £1.5M |
| Total capital requirement | £13.75M | £22.38M |
The full range is committed at close but drawn against milestones over 24-36 months. Renovation runs Y0-Y2 in build sequence, equipment lands as spaces complete, and working-capital drawdowns match the modelled cash trough. Approximate profile: ~£0.8M in Y0 (soft launch + pre-launch marketing + onboarding), ~£4-6M in Y1 (bulk of renovation + Y1 operating loss), ~£3.5-6M in Y2 (finishing capex + peak WC), ~£1-2M in Y3 (final capex tail; operating cash-positive from mid-Y3 onward). Add the bulk Jersey uplift of ~£1.23M-£2.77M spread pro-rata across the Y1-Y2 renovation drawdowns.
External investor cheque. £7.00M – £16.69M for ~22.80% – ~41.32% of The Long Group.
Netting the Parker cash (upfront + ongoing) from the total requirement gives the external investor cheque:
| Line | Low end | High end |
|---|---|---|
| Total capital requirementRenovation capex now includes the bulk Jersey uplift line — see the Renovation page's SPONS callout for the split between UK Outer London construction base and the +15-22% Jersey/CPI premium | £13.75M | £22.38M |
| Less: Parker upfront cashWestview, Guernsey tranches, Turkey, The Lodge — nominal £4.1M / NPV £3.79M | (£4.1M) | (£4.1M) |
| Less: Parker ongoing capital across ramp-up~£530k/yr for 3-5 years (£500k from other Parker businesses + ~£30k HdF surplus routed via the Healthhaus structure — see note in section Two). ERM rentals and the £320k net Healthhaus rent stay with HdF Group to service the pre-existing building debt (see the Forecast's finance-costs note) | (£2.65M)5 years at £530k | (£1.59M)3 years at £530k |
| External investor cheque | £7.00M | £16.69M |
The materially wide range reflects two independent uncertainties: how much capex actually lands (£13.05M-£20.88M scope range post-Jersey-uplift on the current Kala-on default) and how many years the ongoing Parker contribution runs for (3 years = £1.59M, 5 years = £2.65M). Working planning midpoint: ~£11.85M external raise, on assumptions of mid-range capex, mid-range working-capital buffer and 4 years of Parker ongoing support.
Equity offered.
The Parker family enters the capitalisation table at ~£23.70M pre-money, calculated end-to-end at the 8% NPV discount rate — the mid-range rate a corporate finance advisor would default to and the rate that anchors every equity split below. That £23.70M is ~£5.54M cash on an NPV basis (£3.79M upfront NPV + £1.75M NPV of 4 years of ~£530k/yr ongoing at 8%) plus £18.16M in-kind (£14.65M combined lease NPV at 8% + £3.51M working-midpoint intangibles). The pre-money figure is the same at any raise size: whether investors write a £7.00M cheque or a £16.69M cheque, the Parkers put the same buildings, the same operational hotel, the same cash commitment and the same platform value on the table. Adding the investor cheque gives post-money and drives the equity split:
| Scenario | Pre-money | Investor cheque | Post-money | Investor equity |
|---|---|---|---|---|
| Low end£7.00M raised — leaner capex scope + 5 years of Parker ongoing capital covers most of the ask | £23.70M | £7.00M | £30.70M | ~22.80% |
| Midpoint~£11.85M raised — mid-scope + mid working-capital buffer + 4 years of Parker ongoing capital | £23.70M | £11.85M | £35.55M | ~33.33% |
| High end£16.69M raised — fuller premium scope + fuller working-capital buffer + only 3 years of Parker ongoing capital | £23.70M | £16.69M | £40.39M | ~41.32% |
~22.80% of The Long Group Ltd at the lean end (£7.00M raise), rising to ~41.32% at the fuller-scope end (£16.69M raise). Working midpoint: ~33.33% for a £11.85M raise.
Parker family retains ~58.68% – 77.20% of The Long Group throughout, plus 100% of the underlying property in HdF Group Ltd. Board control and reserved-matter protections stay with the Parker family across the whole range.
Sensitivity — where a corporate finance advisor might land the Parker in-kind value.
The £18.16M in-kind midpoint is driven mostly by the 20-year lease NPV at an 8% discount rate. A qualified advisor might land anywhere in the defensible £15.71M – £22.60M range depending on the discount rate chosen for the lease and how the goodwill / brand / list components are priced. Investor equity moves as a pure function of that number for any given raise size, holding Parker cash at the ~£5.54M NPV midpoint:
| Parker in-kind | Pre-money | Investor % at £7.00M raise | at £11.85M raise | at £16.69M raise |
|---|---|---|---|---|
| £15.71Mlease NPV at 10% operator discount + conservative £3.00M intangibles | £21.25M | ~24.78% | ~35.80% | ~43.99% |
| £18.16M (working midpoint)lease NPV at 8% mid discount + £3.51M intangibles | £23.70M | ~22.80% | ~33.33% | ~41.32% |
| £22.60Mlease NPV at 5% property-owner discount + fuller £4.00M intangibles | £28.14M | ~19.92% | ~29.63% | ~37.23% |
Across the full uncertainty range, investors take somewhere between ~19.92% (best case) and ~43.99% (most conservative). All figures directional pending an advisor to firm up the in-kind valuation and the market read on comparable transactions.
Note where a real negotiation likely lands. Investors will push back on two things specifically: (a) the lease NPV ("it's a related-party arrangement", "the discount rate should be operator not property owner") and (b) whether Parker's £1.37M-£2.12M of ramp-up capital should count as committed at close or should dilute investors over time as it is drawn ("we want the pre-money based on the ~£4.1M actually in the account at close, not on a subscription for future contributions"). If both concessions are made — the lease NPV is haircut to the 10% operator discount (£12.71M) with conservative £3.00M intangibles, and the ongoing capital is excluded — effective pre-money shrinks to ~£19.50M (£12.71M in-kind lease + £3.00M intangibles + £3.79M upfront cash NPV). Investor % at that pre-money moves into the ~26.42% – 46.12% range across the raise sizes. That is the anchor to defend from.
What the investor gets. On the modelled Y5 exit.
The Forecast produces a Y5 profit-before-tax that ranges from ~£1.63M (Pessimistic preset) to ~£2.40M (Modelled preset) to ~£2.95M (Optimistic preset) with the B2B corporate revenue rolled into the base and Y5 utilisation deliberately landed at peer-median rather than aspirational. Revised Sep 2026 following (a) Ryan LeCouteur's pushback on the South Wing corporate long-stay ADR — that line dropped from £220 to £170 blended and its Y5 occupancy from 85% to 75%, taking ~£326k off Y5 PBT — and (b) the explicit clinical + regulatory compliance uplift baked into the Y3-Y5 non-wage operating costs (~£65-140k/yr marginal above the Hotel de France baseline, taking a further ~£90k off Y5 PBT). Add back amortisation (~£534k) and the new-debt service (~£400k — see note below) to reach EBITDA, and Y5 EBITDA on the same three cases sits at around £2.56M / £3.33M / £3.88M. In Jersey, hospitality trading is taxed at 0%, so PBT and PAT are the same number.
Note on the finance add-back. Only the new-debt service on the £13.05M-£20.88M capex raise (illustratively ~£10.18M of debt at 6.5% — 60% of the £16.97M capex midpoint post-Jersey-uplift — ~£660k/yr at full drawdown, tapering to ~£620k by Y5 as it's paid down) sits inside The Long Hotel P&L — this is genuinely operating debt because it funds the renovation the operating business needs. The ~£665k/yr of pre-existing debt on the building has been reallocated to HdF Group Ltd, which owns the property the loans are secured against and services them from ERM rentals + net Healthhaus rent. Cascade note: the Forecast currently carries a finance-cost line calibrated against the pre-Jersey-uplift £14.25M capex midpoint (~£420k/yr new-debt service) — the Jersey uplift adds ~£240k/yr of new-debt service and correspondingly ~£240k off Y5 PBT before the EBITDA add-back is re-run. Ryan LeCouteur to review the debt sizing and interest-cost line before this cascade fully lands in the forecast.
| Y5 EBITDA scenario | EBITDA | Enterprise value at 8× | at 10× | at 12× |
|---|---|---|---|---|
| Pessimistic preset | £2.56M | £20M | £26M | £31M |
| Modelled preset (base, B2B rolled in, peer-median Y5 utilisation) | £3.33M | £27M | £33M | £40M |
| Optimistic preset | £3.88M | £31M | £39M | £47M |
Premium hospitality and boutique wellness properties transact at 8-12× EBITDA in current market conditions, with brand-plus-clinical propositions at the upper end of that range. The midpoint investor scenario is a £11.85M cheque for ~33.33% of The Long Group at £23.70M pre-money. On the Modelled preset at a 10× multiple (Y5 EBITDA ~£3.33M with B2B corporate revenue rolled in and Y5 utilisation deliberately landed at peer median 62% → Y5 EV ~£33M), that 33.33% stake is worth ~£11.00M — 0.93× in five years, materially below cost of capital at the mid-range multiple. At 12× (the top of the brand-plus-clinical range and where a well-executed sale in this segment reasonably lands), the same case gives Y5 EV of ~£40M, so 33.33% is worth ~£13.33M — a 1.13× return.
Optimistic execution lands Y5 EBITDA closer to £3.88M (Modelled is £3.33M at peer-median Y5 utilisation; Optimistic layers stronger utilisation on top of that same B2B contribution), which at 12× is a Y5 enterprise value of ~£47M. The same 33.33% holder sees their £11.85M grow to ~£15.66M, or 1.32×. And that excludes any exit multiple expansion, any Phase 03 Long Club London upside (which would be additive to The Long Group's value), and any convergence to midpoint ADR pricing on the room side — that convergence alone would add ~£895k of PBT and ~£9M of enterprise value at 10× (so ~£3.00M of additional investor stake value, worth an incremental ~0.25× on the Modelled 10× return), lifting Modelled 10× from 0.93× to ~1.18×. See the Forecast's "what this model doesn't capture" note for the full lever detail.
This is a 1.0-1.4× / five-year investment on the modelled and optimistic cases at the mid-to-upper multiple range (revised from 1.1-1.6× following the Sep 2026 South Wing corporate ADR adjustment, and slightly further compressed by the explicit clinical + regulatory compliance uplift now baked into Y3-Y5 non-wage operating costs and by the four-lift replacement/refurb programme raising capex ~£0.6-0.9M), with the shape of the return skewed heavily toward Y3-Y5 as operational leverage kicks in. Modelled 10× is now marginally below cost of capital — the investment case leans firmly on the 12× multiple achieving (well-executed brand-plus-clinical exit), Optimistic-preset execution, ADR convergence to midpoint (~+0.27× lever), and/or the Phase 03 Long Club London upside compounding platform value. It is not a venture-style 10× outcome and shouldn't be pitched as one. The right investor profile is family office, patient hospitality investor, or wellness / longevity strategic — someone who values a defensible operating business with a real brand, a clear expansion path, and the compounding real-asset economics, not someone chasing pre-IPO SaaS multiples.
The Phase 03 Long Club London opportunity is the asymmetric upside. If the Jersey property proves the model, a London city club at a fraction of the property capex and higher membership economics could double or triple platform value on a subsequent round — but that is a genuinely second-decision investment, not a promise made on Day 1.
Before any investor conversation. Three things to firm up.
- Corporate finance advisor engaged. Every number on this page — Parker in-kind valuation, investor equity split, EBITDA multiple used for return modelling — needs sign-off from someone qualified to be defending it in an investor conversation. Jersey-based options: BDO Jersey, PwC Jersey, or a specialist smaller advisory. Also worth talking to a London M&A boutique with hospitality specialism (e.g. Christie & Co, Colliers Hotels) for market read on the multiple.
- Structure legally scoped by a Jersey corporate lawyer. The 20-year £0 lease between HdF Group Ltd and The Long Group Ltd — covering both the hotel property and the staff accommodation on a flat unbroken 20-year term — needs to be drafted in a way that survives Comptroller scrutiny. A related-party lease at £0 is defensible but needs the commercial substance documented (family funding of ongoing property maintenance, capital investment obligations, the structural tax rationale). The staff-accommodation-as-BIK extension of that arrangement needs an explicit Comptroller opinion before an investor's diligence team lands on it. Same lawyer drafts the shareholders' agreement, reserved-matter list, and drag/tag provisions for the SPA.
- Financial model tightened. Two open items from Ryan feed directly into what an investor's diligence team will ask about: FY2025 payroll split by department and the £2.36M sundry-income breakdown. Both flagged at the top of the Forecast. Investors will want to see the departmental P&Ls anchored to real data, not modelled estimates, before they commit.
Once those three are in place, the ordinary sequence is: (a) target list of 8-12 investors compatible with the profile above; (b) teaser + NDA; (c) full information memorandum built from this proposal site; (d) 4-6 introductory conversations; (e) 2-3 progressing to term sheet; (f) 1-2 into full diligence; (g) close on the strongest. Realistic timeline from advisor engagement to signed term sheet: 4-6 months. From term sheet to close: another 3-4 months of diligence, structuring and documentation. So ~9-10 months of process from starting seriously to money in the account.
Kept as a hidden page for internal working and eventual advisor conversation. Not linked from the menu, not part of the board-facing proposal that the rest of the site represents.