Administrators Leonard Curtis Business Rescue and Recovery were appointed earlier this week after a winding-up petition was issued for PDR Construction, who were contracted to build a 90-bedroom extension on Huntriss Row to the South Bay Premier Inn, which fronts onto Falconers Road.
All operations at the site have ceased and it is reported that all of the company's staff have been made redundant. The company's website and social media have been taken down.
At this stage, it is unknown what the future holds for the development, which is currently an unfinished building site and under construction.
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The Scarborough News understands that work has not resumed at the site since the Christmas break.
The site's building office opposite the development is shuttered.
Scarborough company Ledden Developments Limited is now in the "exclusive possession and control" of the area, according to a notice on the Huntriss Row site.
Work to convert Scarborough's former Constitution Club into a 90-bedroom extension of the Premier Inn was granted demolition approval in 2015.
The work was forced to stop abruptly in January 2017 when heritage groups successfully campaigned for the front of the building to be Grade II listed; much of the rear of the property had already been demolished.
Plans to develop the now-listed building were passed in May 2017, but work on the site stalled and did not resume until late 2018.
Whitbread, Premier Inn's parent company, told The Scarborough News in March last year that builders were "on-site" and that construction was expected to be completed by early autumn 2021.
In its latest accounts to April 30 2020, PDR Construction made a pre-tax loss of £354,418 from a turnover of £82.7m, whilst employing 115 staff.
In its accounts, Director Paul Dransfield said that growth was 10 per cent lower than expected due to the pandemic and that the firm posted its first loss for a decade.
The Scarborough News has approached Premier Inn, the administrators and Ledden Developments for comment.