Seaside hoteliers face ebbing tide

MORE than one in five North West hotels are at risk of failing within the next 12 months, according to research by insolvency trade body R3.

Using figures provided by Bureau van Dijk’s Fame database, R3 found that 22% of all companies in the region are considered to be “at risk”.

R3’s North West regional chair Jeremy Oddie said: “The hotel and leisure sector had been one of the worst-hit by the economic downturn.

“As consumers have reduced their spending, many hotels have suffered a decline in trade and prices have become very competitive. However, many have high levels of debt so have been unable to discount further and are struggling to meet repayments. The problems may continue in the short term as unemployment and rising inflation continues to put pressure on family budgets.”

Oddie, who recently advised on the sale of the Queens Hotel and Leisure Centre in Blackpool, said the problems were most acute at the region’s seaside towns.

He said: “While some city centre venues may have escaped the worst, the situation is particularly bad for owner-managed businesses in traditional seaside resorts. Many of these rely on repeat business.

“They need to attract a new generation of customers but face tough competition from city breaks and all-inclusive overseas holidays.

“Typically, they occupy older buildings which are expensive to maintain and update to current standards. Traditional hotels like these are facing a more serious challenge.

“We recommend that any hotel which is concerned about the viability of the business should seek the advice of a restructuring professional sooner rather than later.”