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Folio Hotels goes into administration

3/12/2008

A HOTEL group which operates the Etrop Grange near Manchester Airport and the Best Western Princess on Portland in the city centre has gone into administration.

Folio Hotels, a privately-owned operator of 36 UK sites, employs 2,000 people nationwide.

It took over the running of the 85-bedroom Princess on Portland earlier this year after the property changed hands for more than £8m.

It was bought by Dublin-based property and investment company Harcourt Developments.

Administrators at restructuring and insolvency firm MCR are reviewing Folio’s financial position with a view to selling its business and assets as a going concern.

Formed in 2005, Folio Hotels has turnover of £70m.

MCR partner Paul Clark said: “We are being repeatedly told that consumers’ discretionary spending is being reduced and that inevitably the leisure sector will be impacted.

“Well-established, profitable businesses with low levels of debt and a strong capital base are obviously best-placed to weather the financial storm.

“The Folio Hotels Group has been in the middle of an expensive and comprehensive refurbishment project and has also suffered from rentals that were fixed at the height of the market.

“Together with the current economic climate, this has exacerbated cash flow demands.

"However, all the hotels in the group will continue to trade while a buyer is sought as a going concern.

“We are confident that there will be a significant amount of interest.”