Landmark hotel in same family for seven generations for sale
This is a hotel that has been in the same family 165 years, and an appeal was then made for people to rally round while a buyer is sought for the business.
The George Hotel, which is just yards from the Loch Fyne shore in Inverary, was overwhelmed by historical debts.
The debts impacted the critical cash flow of the business, the administrators said. Around 60 jobs were put at risk.
The hotel is near the shores of the loch. (Image: Google) The news about the George Hotel came in recent weeks with the industry on a precipice as a new wave of tax increases were due to come into force at the time.
I know of one hospitality business with a head count of 30 adding £20,000 a year to outgoings on its national insurance column alone.
For longstanding companies that are more than just businesses, they are a part of the community and often significant employers, it has been a difficult time in the wake of the coronavirus pandemic. The costs of Brexit, not least in staffing, continue.
Rachel Reeves, Chancellor of the Exchequer in the Labour government, came under fire after the Spring Statement for not doing enough to help and leaving the outlook bleak for many.
Stephen Montgomery, director of the Scottish Hospitality Group, said that "the Chancellor did not even mention the hospitality industry once".
He said: "The reality is hospitality businesses up and down the country are facing a tax bombshell of nearly £3.5bn, and the Chancellor of the Exchequer's statement has done nothing to allay the danger of job losses and closures across the nation's pubs, hotels, and restaurants."
In the case of the George Hotel, "the difficult decision [was taken] as a result of historical debts which were crippling the cash flow of the business", said Thomas McKay, of Begbies Traynor, who is overseeing the trade and sale process.
"The business has been in the Clark family for seven generations and their priority was to safeguard the jobs and future of the 60 full and part-time employees.
"The hotel has a fantastic history and beautiful location, offering excellent accommodation and food."
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He added: "We ask the local community and customers further afield who wish to use the hotel, as well as the subscribers to the hotel - over 25,000 of them - to continue to support and visit the venue as usual as we seek to find a buyer for the business as a going concern."
In the wider picture, more stays were recorded in Scottish hotels in February compared to the same time the year before, but the RSM Hotels found profits were down as cost pressures continue.
The data, by Hotstats and RSM UK, shows occupancy of Scottish hotels increased slightly from 68% to 69.1% year-on-year in February.
Stuart McCallum, partner and head of consumer markets in Scotland at RSM UK, said the future picture looked worrying for many businesses working in the sector.
"Looking ahead," he said, "the increase in costs from the rise in employer's national insurance, and the national minimum wage rise, continue to cause concern for many.
"The rise in minimum wage potentially has a ripple effect that is felt throughout all staff, as others higher up the pay scale expect to see their salaries rise accordingly.
"As we are already seeing revenue per room reducing, these further cost increases could prove difficult to swallow for many hotel owners."
Thomas McKay, a partner at Begbies Traynor, was supervising business operations as the hotel business continued to trade 'in the normal manner, providing accommodation, food and public house services, while efforts are made to find a buyer on the open market 'for the 165-year-old boutique hotel and inn.
Administrators overseeing the sale have appointed Colliers to market the business and property in Inveraray for offers over £2.85 million.
Colliers said it would be leading the search for a buyer for the waterside hotel, bar and restaurant business, which stands on a one-acre site on the western shore of the loch.
There are also five residential properties for sale as part of the administration, situated adjacent to the hotel and on Inveraray's main street, with a total asking price of around £750,000. Potential buyers and interested parties were urged to make inquiries direct to Colliers' Glasgow office.
This article appeared in Business HQ Monthly
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