Slaley Hall price slashed to end receivership

More than two years after Slaley Hall, the north-eastern hotel and golfing resort development, went up for sale at £20m, it has come back on the market at a much more realistic £4m.

Responsibility for the hotel development and 18-hole golf course has been moved from receivers at Touche Ross to joint administrative receivers at Arthur Andersen, which has instructed William Hillary Leisure & Hotels to find a buyer.

James Devitt, a partner at William Hillary, told Caterer last week that although construction on the site just west of Newcastle ceased in September 1991, the groups of receivers had "not beensitting on their hands" inthe intervening period.

There were a number of matters which needed to be cleared up, he said, before the property could be successfully sold. Those matters, such as titles of land and the acquisition of a gate lodge, have now been resolved.

Mr Devitt said Slaley Hall was now "priced competitively in order to bring to an end the receivership".

"The original price was a full one which would have enabled [the lenders to] exit the property without taking a major loss, whereas the present price does not enable them to do that," he said.

The receivers were originally called in at Slaley Hall when the developers, Seamus O'Carrol and John Rourke, failed to re-finance a debt of £20m on their ambitious hotel and leisure resort.

The developers bought the hall in 1986, then arranged a management contract with the Sheraton Corporation, which is no longer involved in the project.

When finished, the resort will have a 140-bedroom hotel at its core, with a golf club, leisure centre, two 18-hole golf courses and 62 holiday villas set in 650 acres.

At present, 90% of the hotel's structure and 10% of fitting-out work is complete. The golf course is fully mature and 17 villas have been finished.

According to quantity surveyors consulted by the receivers, up to £5m would be needed to complete the resort.