The news that Robert and Vincent Tchenguiz had been arrested last week was greeted with surprise at the International Hotel Investment Forum in Berlin, but with possible disappointment at Mipim, where Vincent hosts a legendary annual party.
The party went ahead without the brothers, which looks like it could be a theme for the wider property market. At least it looks to be the case in the hotel sector, where news emerged over the weekend that another set of brothers – the Barclays – had increased their stake in Maybourne Hotel Group.
Prior to the brothers' arrest, it was rumoured that Robert Tchenguiz was planning a bid of up to £1bn in partnership with Sheik Mansour bin Zayed Al Nahyan, a leading member of the Abu Dhabi royal family.
During the week it was reported that the pair has acquired tens of millions of pounds worth of debt giving them a claim over 20% of Derek Quinlan's shares, equating to 7% of Maybourne. "Obviously we are looking for a good return on our 20% stake and there is an opportunity for us to bid for the hotel group," Tchenguiz told UK newspaper the Daily Mail.
Shortly after making this comment, the brothers Tchenguiz were collected at 5.30am by the Serious Fraud Office and City of London police as part of investigations into the 2008 collapse of Iceland's Kaupthing bank. At the core of these investigations is Robert Tchenguiz, who owned a 1.5% stake in the bank, as well a stake in its biggest shareholder, Exista, and received Eu2bn in loans from the bank and its subsidiaries.
The Financial Times described the brothers' approach to financing structures such as the opco / propco split as "intrepid" and they were seen as the poster boys for the recent property boom. The extensive use of the bricks and brains split is now coming under new scrutiny in the hotel sector, where in the case of some deals, it is felt that greater prudence could have been used and some over-leveraged properties are feeling the brunt.
In a joint statement, the brothers said that both of them were "co-operating fully with the investigation" and were confident that, once concluded, they would "be cleared of any allegation of wrongdoing".
They were released without charge on bail, but the investigation – which is thought to feature not only letters and emails, but also Post-It notes – looks set to be lengthy, with an update not expected until the autumn.
Judging by the increasing interest around Maybourne, its fate could be decided earlier than that. Sir David and Sir Frederick Barclay are thought to have increased their holding in the Maybourne Hotel Group by a further 3% after acquiring the share from Davy deputy chairman Kyran McLaughlin for more than £7m, according to The Sunday Times.
The move would take their equity stake to 28%, plus Quinlan's loans, reportedly purchased from Halifax Bank of Scotland last month, which gives them an option over a further 21.6%. The Barclay brothers have seemingly reiterated their interest by putting The Cavendish Hotel in London on the market, looking for around £240m.
With Quinlan's holdings up for grabs, it is Paddy McKillen's 37% stake which could clinch things for either party and the property tycoon is not giving it up. He is thought to be considering offers from both the Chinese government and Qatar Holdings, but no decision has been made.
HA Perspective: There was already an overdose of rumour and speculation around Maybourne even before the addition of the soap opera brought by the Tchenguiz brothers.
Cutting through the hype, the clear theme that emerges is that luxury hotel assets in prime locations in gateway cities such as London are sought after investments.
Sovereign wealth funds and high net worth individuals are particularly attracted, perhaps not such much for the immediate return but for the long term security and steady asset value appreciation.
For the specifics on Maybourne, hard facts are much needed particularly concerning the role of public bodies such as Ireland's National Asset Management Agency.
Even if it is understandable in the near-term that NAMA is keeping its cards close to its chest, it will ultimately have to account for itself.
For HNWIs and SWFs such public accountability comes only if law enforcement officials become involved or, as is the case across North Africa right now, the wider public decide they want different rulers.