Sunday 15 December 2019

11th hour court challenge casts doubt on Citywest sale

Jim Mansfield pictured in City West
Jim Mansfield pictured in City West

Sarah McCabe

The sale of Dublin's largest hotel is in doubt after a last minute challenge was lodged in the High Court.

At stake is the 798-bed Citywest hotel and conference complex, which is being sold by receiver Martin Ferris to private equity fund Brehon Capital.

Lodged in the High Court on Friday morning, the Section 160 challenge, similar to an injunction, was lodged by HSS Developments (HSSD).

HSSD is linked to developer Jim Mansfield, who built the complex. He died earlier this year. At the height of the boom, Citywest was said to be worth an estimated €100m.

HSSD's directors include several of Mr Mansfield's family members.

The developer lost control of the complex in 2010 when lender Royal Bank of Scotland (Ireland) sent in Mr Ferris as receiver. Mr Mansfield's debts were estimated at around €300m. Citwyest has been operated since by hotel management group Dalata, which owns the Maldron chain of hotels.

Friday's challenge asks the court to recognise a host of alleged planning and ownership issues at Citywest including problems with its sewerage and car parking systems.

HSSD says it owns the massive sewerage system running under the N7 motorway, alleging that the hotel and conference center has no right to use this. It also asserts ownership over a car park at the site.

Court documents also allege that the complex's massive conference venue is 25pc larger than permitted by planners.

The issues will be considered by the court next week. In the meantime the future of Citywest remains unclear.

Its sale to Brehon for about €29m has been agreed, but is understood to have not yet closed.

Brehon owns several other luxury hotels including The Marker in Dublin city centre and The Powerscourt Hotel in Wicklow.

When contacted Brehon declined to comment.

The Hard Rock Cafe hotel and restaurant is likely to be paying close attention. It has shown interest in buying the complex.

Hard Rock wants to turn Citywest into a music hotel themed on its internationally-recognised brand. It would probably team up HSS Developments for this deal.

Regardless of the outcome, this is unlikely to be Dublin-based Brehon Capital's last hotel deal. It has €400m in assets under investment and is reported to be interested in a number of other hotels about to be put up for sale.

Sunday Indo Business

Also in Business