Property company Topland has acquired Hallmark Hotels for £75 million as it aims to build a £1 billion hotel business in the next few years.

Hallmark Hotels has a portfolio of eight four-star hotels in Manchester, Hull, Bournemouth, Croydon, Derby, Gloucester and Carlisle.

The company has more than 700 rooms, employs 600 staff and recorded turnover of £20.2 million in the year to December 2013.

The acquisition takes Topland’s portfolio to 30 UK hotels, including the Menzies group it purchased last November.

The real estate company now operates more than 3,000 hotel rooms across the UK.

Palatine Private Equity and Bridgepoint Development Capital completed the sale of Hallmark Hotels, having each investing £9.4 million for a combined 78% stake in the business in 2007.

Hallmark was established as a vehicle to take over under performing three-star hotels with a view to driving operational improvement and achieving a standardised and upgraded level of quality.

James Hawksworth, finance director at Hallmark Hotels, said: “Palatine and BDC have been extremely supportive through a period of tough trading conditions for the hotel and leisure market.

“We’ve worked closely with both to undertake rigorous renovation and operational improvements to our locations across the UK.

“They’ve been instrumental in boosting the financial performance of the business, while helping to achieve the four-star standard of the Hallmark Group.”

Topland’s director of hotels Lionel Benjamin told the Financial Times that the deal reflected Britain’s economic recovery, which has begun to ripple out from London into the regions over the past year.

“The hotel sector is particularly attractive to our group because we believe we can drive income streams which traditionally have lagged behind other commercial property assets,” he said.

The hotels will “bring scope for increased revenue generation and cost savings through economies of scale and other efficiencies”.

Topland’s hotels are managed by Bespoke Hotels, the UK’s largest independent hotel operator.

Ed Fazakerley, partner at Palatine Private Equity and former Hallmark non-executive director, said: “The UK hotel market has faced challenging times, but through focus on providing a high quality product combined with significant operational improvements and a coherent sales strategy, we have built an impressive chain of four star hotels.”