00:00Newcastle City Council has revealed it may take up to 15 years to recover nearly £40
00:05million in loans linked to the Crowne Plaza Hotel near Central Station, which the authority
00:10took over earlier this year.
00:13The four-star hotel was purchased by the council in March after its former owner, Stevenson
00:18Hotel Limited, a subsidiary of the Clustin Group, went into administration.
00:24Over several years, the council has provided the company with a series of loans to support
00:29the hotel's construction and ongoing operations, amounting to £39.5 million liability that
00:38has now been written off.
00:41In a meeting this week, Mark Nicholson, the council's chief finance officer, told council
00:45as he expects it will take 15 years for the council to claw back that investment through
00:50the hotel's profits.
00:52He said the plan is to operate the hotel in the short to medium term and then consider
00:56selling it, though continuing to run beyond that period remains an option if it proves
01:01financially beneficial.
01:04A report confirmed the council paid just under £14 million to acquire the hotel.
01:10It's currently being managed by a hospitality firm, Ambridge.
01:14An early sign suggests that the business is stabilising well post-Covid, performing among
01:19the best in the city's hotel market.
01:25Nicholson acknowledged the uncertain ease of commercial ventures, but defended the council's
01:30actions saying it's hard to criticise the decisions made.
01:33From my perspective, the council is not in the business of owning hotels, but this was about
01:39supporting regeneration in the Stevenson Quarter.
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