Morecambe's Midland up for sale again

A £10m project to restore Morecambe's Midland hotel has been scrapped, and the hotel is up for sale again.

The owner, a Grimsby-based firm called Leisure Group UK, made the announcement today. It gained planning permission and access to the art deco property in April. The estimated cost rose after asbestos was found embedded in the concrete, requiring much longer to remove than expected.

The company's unnamed private equity backers were unwilling to exceed the £10m put aside for the project, and agent Knight Frank has been appointed to sell the hotel.

The Grimsby-based firm originally bought the seafront hotel last June for more than its £325,000 valuation, and announced a £4m budget to overhaul the building. The hotel had been closed since November 2000 and has since fallen into disrepair.

Mike Baron, managing director of Leisure Group UK, which has changed its name three times in the last year, said today: "We are deeply disappointed that we are unable to deliver our dream. It is sad that such an exciting project should have to end this way, especially with the amount of time and effort which has been expended."

Staff at the hotel and its visitor centre have been offered a redundancy package.