Selsdon Estates OP Co Limited (13719784): administration
- Status
- In administration
- Administration began
- 2023-11-17
- Administrators
- Andrew James Pear, Milan Vuceljic
- Administrators' firm
- Moorfields
- Incorporated
- 2021-11-02
- Location
- London
- Industry
- 55100 Hotels and similar accommodation
Why it went into administration
- Property / lease costs
- Sustained trading losses
From the administrators' statement
Attached at Appendix II is an account of the work undertaken prior to the Joint Administrators’ appointment and the costs associated with that work. Following extensive refurbishment works, the Hotel began trading in March 2023. Since opening its doors, occupancy rates were lower than expected and, although there was an upward trend for the months of May to August, occupation ultimately performed poorly against forecasts. This resulted in lower turnover than expected and, coupled with a significant fixed cost base and capex requirements, ultimately meant that the Hotel was consistently operating at a loss. Given the underperformance on occupation rates, the business was considered likely to fail without a further capital injection to underwrite the losses and underpin performance.
The Company and Prop Co were unable to service their secured loans and the failure to comply with their loan obligations under the facility agreement with TEREF constituted an event of default.
The Company and Prop Co put forward a proposal to TEREF whereby they would advance further capital into the business on the condition that TEREF compromise an element of their facility. The terms of the proposed compromise were not acceptable to TEREF and so the Directors sought advice in respect of their options as to a potential insolvency of the Hotel and certain group entities to protect their interests.
Administrators' statement of proposals (2024-01-16) · Companies House register