Sale considered as interim managers appointed to Virgin Hotels Glasgow in administration process

The Michelin Hotel Guide listed luxury property opened by the Clyde in August this year.

The company that owns the landmark building where Virgin’s Glasgow hotel is based has entered an administration process. Interim managers have been appointed for Lloyds Development Limited, which owns the Michelin Hotel Guide listed luxury property that opened by the Clyde in August.

The outcome comes after the firm posted a loss for the year to May 31, 2022, before members' remuneration and profit shares, of £3.9 million.

A Virgin Hotels spokesperson said it was “very much business as usual” in terms of trading, adding: "This administration process is purely about the capital structure of the property."

Virgin Hotels Glasgow opened earlier this year.

Administration proceedings began for Lloyds Developments LLP in the High Court of Justice, Business and Property Courts of England and Wales, Insolvency and Companies List on November 30. Katy Broomhead, of Interpath Advisory, said: "Blair Nimmo and Geoff Jacobs from Interpath Advisory were appointed interim managers of Lloyds Developments Limited on 1 December 2023. The company is the owner of a property located at 246 Clyde Street in Glasgow. The property is currently occupied and trading as Virgin Hotels Glasgow. The hotel continues to operate and we understand trade as usual.

"The interim managers are fully committed to working with Virgin Hotels and other stakeholders to ensure there is no disruption to operations at the hotel, while they assess options to bring the property to market in due course."

Virgin Hotels opened its second European property in Glasgow on August 18 after officially opening a separate outlet in Edinburgh in March. The completed lower floors of the Glasgow hotel include its flagship restaurant and bar, Commons Club, run by executive chef Jean-Paul Giraud. Upper floors with a series of suites were not completed for the launch of the hotel. A whisky bar set to boast 'one of the finest whisky collections in Glasgow' was to be introduced as part of the next phase of building work. The space is sealed behind a temporary wall in the foyer. The company that owns the hotel building, Lloyds Developments Ltd, is part of a limited liability partnership of four designated members. They are Richard Diamond and Rishipal Singh alongside Lloyds Development Ltd with a registered address in Guernsey and Moreply Ltd, registered in London. All four partners were appointed on 18 May 2017.

In 2021, the company had recorded a profit of £20,299,828, before last year’s loss. Fixed assets were listed as investment property of £77m. Creditors with amounts due within one year were £6,127,281 with liabilities due after more than one year of £48,692,258. Richard Diamond and Rishipal Singh were also directors of two hotel development companies, Tribe Glasgow Ltd and Tribe Glasgow (OPCO) Ltd, that were dissolved in 2021.

A Virgin Hotels spokesperson said: “We can confirm an administration process has started for Lloyds Development Limited, the current owner of Virgin Hotels Glasgow. Geoff Jacobs and Blair Nimmo of Interpath Advisory have been appointed as interim managers of Lloyds Development Limited. It is, however, very much business as usual for the hotel and our team, and we look forward to continuing to welcome guests and build on the hotel’s success.”

They added that each Virgin Hotels brand was an independent owner with Richard Branson's brand operating the property under a hotel management agreement: "This administration process is purely about the capital structure of the property," the spokesperson said.

A number of staff have left the business in Glasgow in recent months, although Virgin Hotels said there had been no redundancies.

Virgin Hotels Glasgow was initially scheduled to launch in summer 2022 before being delayed until December, then opening the lower floors and welcoming guests to some of the projected 242 bedrooms in August. The hotel operator said the property has performed as expected since opening.