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Luxury hotel built up debts of 1.7m
The company running a luxury Norwich hotel went into liquidation with debts of around £1.7m, it emerged yesterday.
The Really Nice Hotel Company, which owned the St Giles House Hotel, ran into financial difficulties after funding from its Russian backers dried up.
The business, which was set up by entrepreneurs Lana and Carleton Van Selman, was forced into voluntary liquidation after falling behind with rental payments, leaving landlord Sutherland Walk Developments to take possession of the property.
Sutherland Walk Developments is now operating the hotel, with the Van Selmans working as employees.
A meeting of creditors yesterday appointed insolvency practitioner McTear, Williams & Wood as liquidators of the Really Nice Hotel Company.
Andrew McTear, of McTear, Williams & Wood, said the Really Nice Hotel Company had debts of around £1.7m, with around £1m owed to its Russian shareholders and directors including the Van Selmans.
Around £100,000 is owed to its landlord in rent, with the remainder owed to the bank and smaller creditors.
Mr McTear said: “We will be seeking over the coming weeks to raise as much money as we can for the creditors. There are some assets that can be sold and there is also some money which has been frozen in a bank account. There is a possibility that the creditors may get a little money back.”
Mr McTear said the ending of funding from the company's Russian share-holders had proved fatal, with the business falling behind on its rental payments.
He said the company was starting to trade profitably, with May a record month and June set to be even better. But he said the company would have needed a cash injection of at least £100,000 to have avoided going into liquidation.
St Giles House, in a historic building in the city, had undergone a multi-million pound conversion under the guidance of the Van Selmans.
It featured in a fly-on-the-wall documentary which laid bare the difficulties of setting up and running a hotel.
Ms Van Selman, who is now hotel general manager, said last week she hoped losing control of the hotel was a temporary setback.
“I regard it as though I have just temporarily handed it over to someone else,” she said.
“It is unfortunate the shareholders stopped financing the company because the hotel was starting to do quite well. It is just unfortunate there was not enough start-up capital to carry it through and we are just having to deal with the current situation.”
21 June 2007
Is the dream over for Norwich hotel queen?
The high profile Norwich hotel dream built by Lana Van Selman and her husband Carleton appeared to be falling apart last night as it was revealed the company behind the ambitious St Giles House project has gone into liquidation. The glitzy couple, whose attempts to transform the historic city building feature in a reality TV show, no longer own the business.