Virgin Hotels’ international portfolio has been halved to one hotel following the sudden closure of its hotel in Glasgow, Scotland.
The 240-room Virgin Hotels Glasgow, which opened on Aug. 18, closed on Dec. 19 — less than two weeks after the hotel’s owner, Lloyds Developments, went into administration on Dec. 1, according to a filing at Companies House on Dec. 7.
The 17-floor hotel was opened for almost exactly four months.
Construction started in April 2019, according to CoStar records, with opening delayed for a year during to the pandemic.
In additional records at Companies House, Lloyds lists investment property with a net book value of 77 million pounds sterling ($97.5 million) for the full year ending May 31, 2022.
In the two most recent reported fiscal years — ending in May 2022 and May 2021 — the company recorded a loss of £3.9 million ($4.9 million) and a profit of £20.3 million ($25.8 million), respectively.
On its website, Virgin Hotels’ CEO James Bermingham said “Lloyds … the owner of Virgin Hotels Glasgow, which Virgin Hotels has a management contract with … has financial problems, and on Dec. 1 its lenders put it into administration. As a result, the directors of V Hotel Glasgow Ltd., the employer and operating company in respect of the hotel, are being advised … as they place that company into liquidation. These financial issues mean that the hotel cannot continue operating and now has to close.”
He added the operator attempted to keep the hotel open, but an agreement with Lloyd’s lenders could not be reached and new owners are being sought to reopen the hotel.
Approximately 200 staff have lost their employment, according to newspaper Scottish Licensed Trade News, although FRP Advisory, the firm advising Virgin Hotels, has confirmed salaries will be paid until the end of the year, along with gratuities for November and December, Bermingham added.
Virgin Hotels only operates one other hotel outside of the U.S., the 222-room Virgin Hotels Edinburgh in the Scottish capital. It remains open and operating.
It has seven hotels in the U.S., with two more in its pipeline — in Denver and Miami.