New shock over hotel group

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THE company behind Scarborough’s crisis-hit Royal Hotel has been dealt a further blow as two more of its hotels fall in to administration.

Administrators have now taken over the running of Hackness Grange and the Wrea Head Hotel.

The Wrea Head Country House Hotel, Scalby, Scarborough.   Pictures by Andrew Higgins  113523a   30/08/11

The Wrea Head Country House Hotel, Scalby, Scarborough. Pictures by Andrew Higgins 113523a 30/08/11

A total of four major hotels, which were owned by the Turner family, are now in administration.

The latest move puts a question mark over the future of the Hackness Grange Hotel, which was owned by English Rose Hotels plc.

Along with the Wrea Head Hotel, it now joins Scarborough’s historic Royal Hotel and the Clifton Hotel which are also being run by administrators.

They had been owned by English Rose Hotels Scarborough Ltd which went in to administration a week ago.

The companies were all owned by the Turner family who had built up “significant” debts in tax arrears.

Managing director David Turner would not reveal how much the English Rose Hotels Scarborough Ltd owed, but said he offered £600,000 of the family’s private money to try and negotiate repayments.

He blamed corporate banking for the demise of the Wrea Head and Hackness Grange.

Mr Turner said: “Despite year on year trading for the group being up on 2009/2010, no mean task, crippling management and arrangement fees applied by Barclays Bank, from 2008 to the present day, have made it impossible for us to meet our forecasted cash flow, with the lifeblood of the business, its cash flow, being sapped dry.”

Price Warehouse Coopers, acting administrators for the Wrea Head Hotel and English Rose Hotels Plc, are continuing to run the two hotels as normal while they seek a buyer.

The Royal Hotel, in St Nicholas Street, and the Clifton Hotel, in Queen’s Parade, are also being operated by the administrators, with the 94 full time equivalent staff being kept in their jobs until a buyer is found for the hotels.

A week after taking over English Rose Hotels Scarborough, administrators at MCR are yet to enter in to discussions with interested parties.

Prior to administrators being called in the Wrea Head Hotel and the Hackness Grange hotel were already up for sale.

The 33 bedroom Hackness Grange Hotel, which sits in 11 acres of North York Moors National Park, has been on the market with a price tag of £1.8 million.

The properties particulars reveal the business made £175,000 profits on £855,979 net turnover.

Equally in profit according to the estate agents was the 20-bedroomed Wrea Head Hotel, which was said to have budgeted for £130,894 from a net turnover of £720,753.

The English Rose Hotels empire, which also previously owned the Holbeck Hall Hotel and the Norfolk Royal in Bournemouth, has been split into a number of sub companies.

Speaking after the demise of English Rose Hotels Scarborough, which owned the Royal and the Clifton, Mr Tuner told the Evening News the Wrea Head Hotel, the Hackness Grange Hotel, and The Green Man in Malton, were all owned by English Rose Hotels Yorkshire Ltd.

However the latest administrations have revealed the Wrea Head Hotel was its own ltd company, and the Hackness Grange Hotel fell under English Rose Hotels plc.

The Green Man at Malton falls under English Rose Hotels Yorkshire Ltd, which according to Mr Turner still continues to trade “at this moment in time”.