Fri, 19 May 2023 | ADMINISTRATION
A seaside hotel in South Shields has been sold out of administration after being traded by administrators from RSM UK Restructuring Advisory LLP for nearly ten months. RSM’s Lee Lockwood and Gareth Harris were appointed as joint administrators to Hotel 52 (Sea) Limited by creditor Assetz Capital in July 2022.
The administrators engaged property specialists Colliers to market the hotel for sale at an asking price of £1.65 million, with the business, which trades as Sea Hotel, remaining open and trading throughout the process. A sale has now been completed for an undisclosed amount to Resource Medical (UK) Ltd, a group that operates a number of hotels in Yorkshire, as well as a pharmacy business.
Following the acquisition, the new owner plans to make a significant investment in the 34-bedroom hotel, which underwent a £750,000 refurbishment in 2018 and features a restaurant, bar and self-contained function room.
Prior to its collapse, the hotel was owned by The One Collection Leisure Ltd, which had been part of the Newcastle-headquartered High Street Group. During the first half of last year, the hotel incurred losses of £123,000, having also registered a loss the year prior. At the time it entered administration, it was reported to owe close to £2 million to creditors, including HMRC, Assetz Capital and various suppliers.
A small number of redundancies were made upon the appointment of RSM, with a core staff retained to keep the hotel operational during the sale process. Administrators say that losses of £117,000 were likely to have been incurred during the time since their appointment, but that the majority of bookings had been honoured. The hotel’s continued operation since it fell into administration was partly financed by £75,000 in funding from Fresh Thinking Partners, which will be repaid.
Commenting on the process, RSM UK partner and joint administrator Lee Lockwood said: "It has been a complex nine months facilitating the sale of the Sea Hotel and I am pleased we have been able to agree a sale with the new owner which has secured the majority of future bookings.”
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