Receiver calls in experts to run hotel with €40m debts
Financial experts have been called in to run a four-star hotel and spa complex after its owners racked up debts of more than €50m.
The move was prompted by AIB, which is owed money by the proprietors of the Osprey Hotel in Naas, Co Kildare, John and Mary O'Connell, through their company Naas Developments.
The bank appointed Paul McCann, of accountancy firm Grant Thornton, as receiver.
As a result Mr McCann has brought in Dublin-based Hotel Asset Management Services, a company which specialises in advising hotels who are experiencing trading difficulties on how to run their business.
Naas Developments owes more than €40m in loans, according to its most recent accounts for 2008.
Mr McCann was also appointed receiver of construction firm Twangbrook which is also owned by the O'Connells. It is understood that Twangbrook has debts of €14m.
Mr McCann told the Irish Independent yesterday that the hotel, which employs 150 full and part-time staff, would remain open.
"The company has debts but it also has strong assets and the hotel, conference centre, spa and nightclub will continue to trade," he said.
The Osprey Hotel was developed on the site of the old Devoy Barracks beside the Kildare County Council offices in Naas and opened in 2004.
It is believed its conference business has been hard hit in the recession.
Earlier this week, a report on the hotel industry concluded that fierce competition within the industry had pushed average room rates drop back to 1999 levels of €77.81 a night.
The annual study, by consultants Horwath Bastow Charleton, also revealed that one-third of Irish hotels are experiencing difficulty in meeting interest repayments on their bank loans.
Profits in Irish hotels have plummeted by 50pc since 2007.
There is also an excess capacity of 10,000 hotel rooms which were built during the property boom.