If CO is correct and the hotel building requires £2m spending on it (plus £2m refurb), it might be more attractive to sell the site to Premier Inn who could flatten it and build a new one for £5m which would have lower operational costs.
It would be hard for the TVA to justify spending (say) £1.5m+ on basic regulatory compliance for and conversion to 2nd tier offices for rent. Of course, you might question the value for money when it comes to TVA's investment decisions but there is no payback or strategic rationale here.