Travelodge, Britain’s second-biggest operator of budget hotels, has stepped up its expansion plans with the acquisition of six properties from Menzies Hotels.

The sites, in Bath, Coventry, Edinburgh, Newcastle, Oldham and Stevenage, will see Travelodge add more than 700 rooms to its estate.

The properties are owned by R20, an investment vehicle of Robert Tchenguiz, the property tycoon. He has formed a partnership with Travelodge to invest and expand the sites.

The hotels now have 650 rooms, but this will be expanded by converting gyms, restaurants and meeting areas. The project is expected to cost about £14m. The value of the leases Travelodge is taking on is £85m.

There is fierce competition for new sites in the budget hotel market, particularly in London. This month, Travelodge’s great rival Whitbread, owner of the Premier Travel Inn chain, announced it would buy three properties in the capital from Real Hotel Company for £18.5m, and that it had secured an option to buy 12 more hotels from the same group.

Last month, The Sunday Times revealed that Travelodge’s main shareholder, Dubai International Capital, and Whitbread had held talks about merging the two businesses, but those talks ultimately collapsed. Industry sources believe it is unlikely they will be revived.

Times Recommends

• C&G axed - 1,660 jobs to be lost
• UK house prices rise 1.1% as buyers return
• Mixed reaction to US banks repaying bailouts