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G8 resort has cost bank more than £20m: report shows

By Gordon Deegan

Published 01/01/2016

Lough Erne Resort hosted the G8 leaders in 2013
Lough Erne Resort hosted the G8 leaders in 2013

Co Fermanagh's Lough Erne Resort - which played host to world leaders attending the G8 in 2013 - has cost its original bank funder more than £20m, a report has shown.

The resort, put into administration in 2011 by Bank of Scotland, was sold to a group of US investors headed by financier Michael Saliba last July.

The attraction includes a 120-room luxury hotel and two championship golf courses, including one designed by Nick Faldo.

A report by administrators KPMG confirmed gross proceeds in excess of £7m from the sale were received for the resort, which played host to world leaders attending the G8 including US President Barack Obama and German Chancellor Angela Merkel.

The administrators immediately paid the Bank of Scotland £5m from the sale, but the amount fell far short of the £26.4m owed to the bank at the time that KPMG were appointed as administrators in May 2011.

The administrators stated that a final payment would be made, however, the report disclosed that the Bank of Scotland had sold all rights to its security and amounts owing from the charge on the hotel company's assets to Dublin property firm Feniton Property Finance.

All future payments relating to the charge are to be made to the Dublin company.

The five-star, 600-acre property sits on its own peninsula between the shorelines of Lough Erne and Castle Hume Lough, close to Enniskillen.

Businessman Jim Treacy developed the combined hotel and golf course with the aid of a £26.4m loan from Bank of Scotland. The business fell into financial difficulty following the financial crisis.

The figures showed that while the Bank of Scotland has received a fraction of what is it owed, unsecured creditors owed £3.5m will be left empty-handed.

The hotel's administrators stated they believed that "there has been insufficient realisations to facilitate a distribution to unsecured creditors and therefore unsecured creditors will not receive a dividend".

They added that "costs directly attributable to ensuring the successful sale of the resort including funding for trading, title rectification and associated costs and apportionments at the date of sale amounted to £1.19m during the period covered by this report". Costs of £2m were directly attributable to the sale.

Belfast Telegraph

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