Louis Naudi owns the freehold of this property: "I have a mortgage for 45% of its value so I'm not really in debt," he explains.
"The one thing I would like to have is more staff accommodation, as one of our major problems is getting good-quality staff out here. I recruited two chefs from outside the area and had to pull in all the favours I know to find them accommodation.
"I looked into buying the building adjoining the hotel but its owner doesn't want to sell - he wanted me to refurbish it, then rent it off him, and I thought ‘No way!'
"There aren't really any major changes I want to make to the exterior of the building, as I've spent the past nine years and close to £750,000 on restoring the property - it was a priority for me.
"Everything has been gutted, restored and replaced. I had to replace all the windows as none of them closed, because the property (which dates back to 1862) is built on sand, so none of them are straight - it's a feature of the town.
"I had to replumb and rewire the entire building, and install two new boilers. The kitchen was appalling and had to be replaced - very little worked. We also had to replaster the walls and put down new carpeting.
"We've also spent the past three months restoring the dining room floor. We managed to uncover the original floorboards, but finding the same type of wood wasn't easy. I managed to get a French polisher to come down here, who's also restoring the bar. He's knocked down the wall that made two bars so now it's just one big bar and it's back to its original state.
"I don't really have any legal issues - my main problem is trying to find time to deal with all the regulation notices from the council, and health and safety issues. If I need to have someone climb a ladder, I have to have a health and safety policy on that, which involves getting a risk assessment consultant, which costs the earth.
"The fire officer has been round to conduct a fire audit, putting smoke detectors in every room, which also costs a fortune."
Mentor Peter Birnie says: "As Louis owns the freehold property and it's now in good condition there aren't really any property issues. It's very clean and tidy, with good signage. He's very punctilious when it comes to legal issues, such as contracts with his suppliers, and he has a good relationship with his fire officer and the food hygiene officer.
"He also ensures his staff put any health and safety issues in writing and this is a good habit to get into - it covers the contracts. I think he's had only one bad debt in 10 years."
The hotel's financial year ended in February 2009, and Louis Naudi and business partner Estelle Metso beat last year's record. During December and January the hotel clawed back some money, which resulted in it being £20,000 up on turnover, compared with the previous year.
All of the hotel's major refurbishment will be finished by the end of the month. Naudi plans to cut the investment programme to cover wear and tear only over the next eight to 10 months. He has also launched a mailshot campaign for Easter and has been spending a great deal of time rewriting the restaurant's wine list on the advice of mentor Peter Birnie.
The hotel's drink trade has also gone up, by 8% in February and 14% in January. Because it gets its wine from Beacon, it is able to undercut other hotels in the area.