The Real Hotel Company today revealed that it is suffering from the economic downturn, making an operating loss of £1.5m for the first six months of the year.
The company, which recently exited London with the £18.5m sale of three of its hotels to Whitbread, saw losses increase by £1.4m compared with the same period last year (2007: £100,000).
The group, which operates the Purple, Quality and Comfort brands, also revealed that revenue has dropped by 1.6% to £37.1m (2007: £38.7m)
Chairman Peter Catesby said: "Trading in the mid-market hotels is starting to suffer from the effects of a contracting domestic economy which is disappointing."
But Catesby said the company's development programme remains on track, with more than 1,000 rooms for the budget Purple brand in planning, legal or construction stage.
"The credit crunch is a double-edged sword and has helped our pipeline to strengthen to more than 2,500 rooms under offer," he added.
By Gemma Sharkey
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