InterContinental Hotels said Qatari-backed investment firm Constellation Hotels bought its Park Lane hotel for £301.5 million - 62% more than its net book value just three months ago.
However, IHG will continue to run the luxury 447-room hotel on behalf of Constellation after striking a 60-year management deal.
The hotels giant has been busy selling assets to free up cash, and since 2003 has sold 191 hotels to recoup 6.1 billion US dollars (£4 billion).
IHG chief executive Richard Solomons said the deal is "another step in our long-standing commitment to reduce the capital intensity of IHG".
Constellation is also believed to have bought the freehold for the site from the Crown Estate, paying a reported £100 million. The FTSE 100-listed hotels giant said it expects to earn £4 million a year in management fees from running the hotel.
The InterContinental London Park Lane opened in 1975 and generated revenues of 89 million US dollars (£59 million) in 2012, with underlying earnings of 39 million US dollars (£26 million).
George Nicholas, executive vice president for northern European deals at agent Jones Lang LaSalle, which sold the hotel, said: "The sale represented an extremely rare investment opportunity with only a handful of trophy Mayfair hotels changing hands during the last decade."
Analysts at Investec Securities upped their rating on the stock as the sale increases the likelihood of imminent cash returns for shareholders.