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Owner Hotels on the edge of administration

17 April 2009 by
Owner Hotels on the edge of administration

The future of buy-to-let company Owner Hotels is uncertain with reports suggesting it is just days from entering administration.

The company, which operates hotels in Hull and York, uses 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, receive 50% of the net room rate, with a guaranteed annual return of between 8 and 15%.

But it emerged this week that the firm, which is headed up by Andy Woodcock and Julie Walker, could be just days from entering administration, with reports suggesting that staff have walked out of the Hull property after not being paid, and several investors claiming to have not received any of the money owed to them over the past few months.

In addition, a source revealed that staff pay cheques at the company's York hotel, Jorvik, had bounced and that staff had not been informed of the seriousness of the situation.

Sheila and Gary Hunt, a couple who invested £90,000 in the Hull scheme in January 2009, told Caterersearch they were "incredibly angry", claiming Owner Hotels took the full down payment from them, when it was already in financial trouble in January.

The pair were contracted to receive a 10% return on their initial investment each month of the first two years, but failed to receive their first income in February.

After repeatedly contacting the company they eventually received one of their instalments- part in cash, part in cheque- but are still missing one of their owed instalments and have not been told the current state of the business.

Gary Hunt said: "I'm incredibly angry because we sat down at the end of January and they took our money when they knew they were already in financial trouble. If they had any decency they wouldn't have done that.

"The managing directors, or anyone at the company, are now refusing to take our calls. It is totally unacceptable that, as an investor who has spent £90,000 I cannot speak with the company owners just to find out what is going on."

Woodcock and Owner Hotels did not respond to calls from Caterersearch.

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By Gemma Sharkey

E-mail your comments to Gemma Sharkey here.

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