'World's most expensive hotel' put up for sale

The taps are gold-plated and the royal suite comes with two butlers and a Bentley, but even the richest tycoon would balk at this hotel's price of nearly £1.3m per room.

The taps are gold-plated and the royal suite comes with two butlers and a Bentley, but even the richest tycoon would balk at this hotel's price of nearly £1.3m per room.

The Lanesborough, the London hotel of choice for showbiz aristocracy from Michael Jackson to Madonna, and at least one president of the United States, George Bush, will be sold for £120m. If the deal to sell the luxury hotel to a Syrian investor proceeds, the 95-bedroom hotel will become the world's most expensive, at £1.26m for each opulent suite.

The hotel, on Hyde Park Corner, was opened in 1992 after being converted from a hospital at a cost of £100m. Room prices per night range from £311 for a deluxe single to £5,287.50 (excluding breakfast or dinner) for the 2,845sq-ft royal suite, which covers the hotel's entire second floor.

Executives at the Lanesborough's PR agency, R-JH, co-owned by the Countess of Wessex, were tight-lipped yesterday about the progress of the sale and the buyer's identity. A spokeswoman said: "The Lanesborough is being sold but we cannot discuss the value of the bids we have received or who has made them."

Simon Halabi, a Syrian-born British citizen who bought the former Naval & Military Club in Piccadilly last year with plans to turn it into a five-star hotel, is understood to have proposed the winning £120m bid. The current owner of the Lanesborough, the Abu Dhabi Investment Authority, has agreed to the sale only after securing a considerable return on its original investment.

Whatever price is finally agreed for the hotel, however, the new owner will never get the kind of bargain achieved by its previous proprietor.

When, in the late 1980s, the health service decided to shut St George's Hospital, as the building then was, it was found that the former Duke of Westminster, who sold the building to the state, had inserted a clause in the original deal allowing his estate to buy it back at the same sale price.

The current Duke of Westminster duly paid the 19th-century price to buy back the £60m piece of prime central London real estate from the Government. The money he had to find was £6,000.