'Jewel in crown' has lost 70pc of value
Slieve Russell hotel
Published 12/11/2011 | 05:00
THE jewel in the crown of tycoon Sean Quinn's former empire, the Slieve Russell hotel, has lost almost 70pc of its value in four years, the Irish Independent can reveal.
Newly filed company records show that a Celtic Tiger-era valuation of the troubled hotel quantified the worth of the land, building and fixtures at €65m.
But valuations by surveyors in August 2010 and this year put the worth at €20.6m.
Mr Quinn built the four-star hotel and golf course on a 300-acre site near his home in Ballyconnell, Co Cavan, in 1992.
He invested IR£14m in the venture, one of his first forays into the hospitality sector before buying pubs and hotels around Ireland, Britain and eastern Europe.
In 2002, profits exceeded €1m and the following year Mr Quinn was reported to have invested a further €8m to expand the then 150-room hotel to 222 rooms.
His daughter Colette ran the hotel while two other daughters, Ciara and Aoife, had their wedding receptions there.
However, the hotel has been caught up in the collapse of the empire and the family no longer have any involvement in it.
The company's most recent accounts, filed at the end of October, show how estimates for the value of the property have been slashed in the past four years. The 2009 accounts reveal that a 2007 survey of the property and its land by Colliers Cre put its value at €65m.
However, in August 2010 a valuation by Jones Lang laSalle Hotels found: "The company's freehold land, buildings and fixtures were valued at €20.6m on the basis of market value."
A subsequent valuation in August this year found the value was "not materially different" to last year.
Anglo Irish Bank appointed a share receiver at the hotel in April, and new directors were installed, though Mr Quinn's daughter Colette remained a director until August 31.
The accounts also list debts of €65m with Anglo Irish Bank and show the hotel had shed 55 staff by the end of 2009. The business also suffered a €3.4m -- or 19pc -- reduction in turnover from €17.6m to €14.2m.
It made a net loss of about €45,000 and the fall in turnover was noted as "resulting from the challenges faced during the year with reduced activity in the hospitality sector".
The directors' report conceded the "current economic climate is difficult" but said "the company is expected to generate positive cash flows" in 2012.
Asked about the hotel's fall in value, one of the company's directors, Pat McCann, who was appointed in April, said: "I'd prefer not to say anything at this point." The hotel's general manager, Tony Walker, also declined to comment.