Hotels shut as chain suffers
Jan 22 2009 By The Journal
MORE than 20 jobs were under threat last night after two Tyneside branches of a national hotel chain plunged into administration.
Staff at the Quality Hotel on Newcastle city centre’s Newgate Street were reportedly called into a meeting to be told they were being made redundant.
A scrawled note on the door of the property instructed people to take their belongings to the nearby Royal Station Hotel. It read: "If you are due to stay here tonight we have transferred your booking to the Royal Station Hotel. They will honour your booking."
And a source from the premises revealed staff were called to a meeting yesterday.
The source said: "It came completely out of the blue. None of the staff had any idea that they were going to be sacked.
"Everyone was handed a letter telling them the hotel had gone into administration and they were being made redundant with one month’s pay.
"Then they were told they had an hour to get the belongings and leave."
Guests were forced to haul their bags across the city after being told they had been moved to the Royal Station Hotel, near Newcastle Central Station.
Richard Holmes, 39, a businessman from Sheffield, said: "I was planning on staying, but when I got there I saw the notice. It’s a shame for the staff. "
As well as the hotel in Newcastle, the Real Hotel Group runs a second property in Witney Way, Boldon, South Tyneside.
Last night the company confirmed that this branch would continue to trade.
However, tourism chiefs claim the financial troubles of the holiday chain do not reflect the tourism trade as a whole.
NewcastleGateshead Initiative chief executive Andrew Dixon said: "There has been a sustained growth in new hotel product in Newcastle and Gateshead with 42% increase in hotel beds in the last five years. We would hope that any displaced staff would soon find new employment."
Shay Bannon, business restructuring partner at BDO Stoy Hayward said: "The group has experienced deterioration in trading during the last quarter of 2008 with this trend accelerating into the first two weeks of January, which resulted in severe cash flow pressures.
"It is regrettable that we have had to close a small number of hotels but we continue to trade a significant number of hotels and will be actively marketing the group for sale. We have already received several expressions of interest and are confident of a successful outcome which will save a significant number of jobs."
