Anton McNulty
The ‘large number of cancellations’ over the winter months has been blamed for a receiver being appointed to the Breaffy House Resort in Castlebar.
Last week Michael McAteer of Grant Thornton was appointed by Bank of Scotland (Ireland) following a request by Michael Lynch, founder of the Lynch Hotel Group, which owns the Breaffy House Hotel and Resort. The Breaffy House’s sister hotel the Clare Inn Hotel and Suites have also been placed into receivership.
The hotel will continue to trade and the staff will be retained but faces an uncertain future, with the Lynch Hotel Group in financial difficulty. In 2009 the group emerged from examinership and accounts to the end of December 2009, show that West County Hotel Ltd, the parent entity for the Lynch hotels, had accumulated losses of €21.2 million.
It is understood that the loans owned to Bank of Scotland total more than €20 million and Pat McCann of Maldron Hotels has been appointed to operate the two hotels. The Breaffy House Hotel has 200 rooms along with a sports and events arena and all customer bookings are to be honoured.
In a statement, Mr Lynch said the poor weather in the lead up to Christmas led to a ‘large number of cancellations’ which was a ‘significant blow’ for the chain. He added the decision of Bank of Scotland to withdraw from this market ‘had a serious impact’ on its ‘ability to source working capital over the winter’.
“It is with great regret that we have had to make this decision but I am happy that in our discussion with the bank and receiver we have secured a position where the properties will remain open and continue to trade.
“With average room rates down 15 per cent this year, it has made it much harder to trade in the family and corporate markets and to command any sort of rate to cover costs and meet our expenses,” Mr Lynch said.
