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Buy-to-let investors reopen closed York hotel

28 July 2009 by
Buy-to-let investors reopen closed York hotel

The closed hotel in York that was formerly operated by buy-to-let firm Owner Hotels has been reopened under a different management company after Owner entered administration.

The Jorvik hotel on Marygate in York, which was closed earlier this month, has now been reopened under the newly-formed York Room Owner management company- a group of original investors in the buy-to-let scheme.

A spokeswoman for the hotel said the hotel had closed because the former management company, Owner Hotel Management, had also been put into liquidation, and staff contracts had to be amended to accommodate the changes.

"The staff of the hotel are the same as before the close, we always knew we would be changing management companies as we knew Owner Hotels was going to enter administration."

Administrators Ernst & Young were called into the Hull-based firm at the beginning of July after the group "incurred significant trading losses".

The majority of the rooms in the hotel are owned by private investors, under a lease scheme. Owner Hotels had used a model where an investor buys a hotel room on a 999-year leasehold basis with prices ranging from £70,000 to £120,000.

The investor is then entitled to stay in the hotel for up to 52 nights a year free of charge and receive 50% of the net room rate, with a guaranteed annual return of between 8% and 15%.

Owner Hotels first started to experience difficulties in April this year when the firm, which is headed up by Andy Woodcock and Julie Walker, were faced with a staff walkout at its Hull property who claimed they had not been paid.

Buy-to-let group Owner Hotels closes York property >>

Buy-to-let operator Owner Hotels falls into administration >>

Owner Hotels on the edge of administration >>

By Gemma Sharkey

E-mail your comments to Gemma Sharkey here.

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