Up to 126 local jobs could be threatened following the news that developers building a luxury hotel for Eastleigh Borough Council have gone into administration.
The planned £32 million Hilton hotel at the council tax-payer owned Ageas Bowl sport stadium – home to Hampshire County Cricket club is currently 75% completed.
In July, Eastleigh News learned that were 167 workers on site with 126 locally based and employed by local firms. This included labourers, plasterers and dry liners, renderers, block pavers and ground works contractors – but today all work had ceased and the site was locked.
In a statement Paul Bolton, Chairman of development company Denizen Contracts – “Construction Company of the Year 2011” – said problems had become apparent in some of their contracts last year but despite the efforts of a new management team they had unable to turn the company around.
Although they had been successful in finding a new contractor for two of their outstanding hotel sites in Sheffield and Southport this was not possible at the Ageas Bowl so administrators had been appointed to try and find a buyer for the contract.
Mr Bolton had also previously been a director for ‘Sanguine Hospitality’ – the operator the council had selected to run the hotel resort on completion – but the company was sold recently to Interstate Hotels.
The news was completely unexpected as only four weeks ago Council Leader Keith House had cheerfully reported to cabinet that construction of the hotel was at an advanced stage with some bedrooms already being fitted out but it is understood that it was a grim faced House that told other Lib Dem members of the latest hiccup last night following a secret members seminar into the Local Plan.
The hotel has long been the subject of controversy.
The council were first approached by the Rose Bowl (as the Ageas Bowl was then named) in 2009 for help them build a hotel after funding from the Allied Irish Bank was no longer available following the banking crash.
In 2010 a consortium of local hoteliers mounted a costly legal challenge which was eventually thrown out – a further attempt at a judicial review was withdrawn.
In 2011 Eastleigh Borough Council agreed to buy the stadium and undertake to build the 175 bed Hilton hotel in £38 million pound rescue deal after the Rose Bowl found itself unable to service debts of £12 million.
Councillor House had hailed the multi-million pound deal claiming it would create jobs and
“Protect vital local services and keep council tax down.”
A spokesman for Hampshire County Cricket Club owners RB Sport & Leisure Holdings said in a statement this morning:
“Whilst there will inevitably be a short delay to the opening of the hotel, funding to complete the project remains in place and the process to replace Denizen as the main contractor is already underway.
“This development will not affect the ground’s ability to host major events in 2014.”
A Council spokesperson said:
“We are fully aware of the situation with the main contractor and working with key partners to secure another contractor to complete the hotel as soon as possible. The hotel is 75% complete and the Council’s finances are fully protected.”
Cllr Keith House, Leader of the Council added:
“It is now about finishing the job and we are confident that in working with partners this project will be up and running as soon as possible.”