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McAleer & Rushe lands £25m English hotel deal

By Margaret Canning

Published 18/11/2016

An artist’s impression of the new hotel
An artist’s impression of the new hotel

Co Tyrone construction company McAleer & Rushe has signed a £25m deal to build and lease out a four-star hotel in Newcastle, England.

The business's subsidiary, ES Newgate, is due to develop the 226-bedroom, six-storey property, which will become a Maldron Hotel when finished.

The project is the company's latest work with Irish hotel plc Dalata Group, and will be the first Maldron Hotel in England.

McAleer & Rushe will retain ownership of the property, which will be leased to Dalata through a 35-year contract.

It is expected that the building - on the site of the former Newgate Centre - will open in the summer of 2018.

McAleer and Rushe is also building student accommodation as part of the same mixed-use development, which is worth £100m in total.

Stephen Surphlis, the company's property director, said: "The addition of this quality hotel brand reflects the wider importance of this entire mixed-use development and will be a major asset to the city as a whole, as well as attracting business and leisure travellers to Newcastle.

"We look forward to working alongside Dalata, for whom we have previously delivered numerous projects."

Closer to home, McAleer & Rushe is working on the construction of a new Maldron Hotel at Brunswick Street in the centre of Belfast.

It will be the company's fourth hotel here. It also owns the Maldron Hotel at Belfast International Airport, the Clayton Hotel on Ormeau Avenue in the centre of the city, and the Maldron Hotel in Londonderry.

Dalata currently operates five Clayton hotels in England, with two in London, and one each in Cardiff, Leeds and Manchester. It additionally owns the Croydon Park Hotel in London.

Dermot Crowley, deputy chief executive for business development and finance at Dalata, said: "This development provides us with an exciting opportunity to launch our Maldron brand in the English market.

"(This is) in line with our strategy of rolling out our Clayton and Maldron brands in the large regional UK cities.

"We are delighted to be working on this project with our development partner, McAleer & Rushe, and we look forward to opening in Newcastle in the summer of 2018."

Dalata, which has become Ireland's biggest hotel group, recently announced the acquisition of the leasehold of Dublin's Doubletree by Hilton - the former Burlington Hotel.

McAleer & Rushe, meanwhile, has established a still growing contracts division for the building of student accommodation and hotels.

Turnover in that branch of the company jumped 73% to £180m in the year to the end of December 2015.

Accounts for McAleer & Rushe Construction Contracts UK Ltd, based in Newcastle, showed a 66% jump in pre-tax profits to £5m in the same period.

The accounts detailed 20 ongoing projects in design and building, including a 1,000-bed student housing scheme in Portsmouth worth £51.5m

The company is even turning down work so that it can make sure projects are finished on time, and hopes to be avoid relying on bank loans in future.

A strategic report explained: "Despite the availability of work during the year, the group has not taken up all the opportunities presented to ensure focus remains on the timely and cost-focused delivery of a manageable workload."

McAleer & Rushe is building 740-room student accommodation at 78 College Avenue in Belfast, as well as more student housing at McClintock Street. The McClintock Street and College Avenue developments are to be sold to Queen's University.

In March, the firm landed a £26m deal to build a major new hotel at Stansted Airport.

Belfast Telegraph

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