Shelbourne owners may never see return on €230 million investment →
sbpost.ie/news/shelbourne-ow … 47273.html
The owners of the Shelbourne Hotel in Dublin may never see any return on their €230 million investment in the St Stephen’s Green property. The consortium of investors, including property developer Bernard McNamara, bought the hotel in 2004 for €120 million and injected a further €110 million into a redevelopment and refit of the property.
However, court documents filed by John Sweeney, the Galway businessman who owns one-third of the hotel, state that the investors have earned nothing from the investment to date and there is no indication that there will be any return in the near future.
In documents to support a petition for examinership for Sweeney’s main company, Black Shore Holdings, his advisers said that Black Shore had ‘‘invested €24 million into the Shelbourne Hotel development’’.
They added: ‘‘
To date, there has been no return on this development.
there is more
February 7, 2010, 8:18pm
The Shelbourne has about 230 rooms. The hotel was bought for €230m.
My maths ain’t too hot, but erm…
I would say that 1m euro a room would not actually be considered out of range for a Euopean Capitals Trophy Hotel, but they are never bought with a view to the income, more the long term capital gain, of which there will be none in Ireland for 10 years.
This was a good vanity project where the guys lost the run of themselves…
Total cost of purchase and refurbishment is 230M …1 million Euro a room
If there were servicing a loan of 230 M at 5% annually …it would need 50000 Euro profit per room per year.
This is 136 euro per night …so you need to sell the rooms at 250 Euro per night just to keep things going
with 10% occupancy ?
shoebox calculation but it looks like a lot of these project did not have anyone using their
calculator …a nice nama place.
February 8, 2010, 12:36am
Sweeney is in the commercial court this week , we should hear quite a bot more about the Shelbourne then.
thepost.ie/newsfeatures/sweeneys … 47243.html
**Sweeney’s empire faces D-day **
07 February 2010
By Ian Kehoe, Chief news correspondent
John Sweeney has spent almost 25 years building his business empire. Starting with an oil franchise in Clifden, Co Galway in 1987,Sweeney quickly showed hi s entrepreneurial flair. Over more than two decades of expansion, he transformed himself into one of the richest men in the country.
Sweeney’s business interests are as diverse as they are extensive. From his beginnings in fuel distribution, he expanded to include filling stations, property, convenience stores, hotels and even a few clothing outlets.
At one point, Sweeney Oil was one of the largest fuel distribution businesses outside of Dublin. His oil interests have tapered off since, but the business still generates annual revenues of almost €200 million.
More recently, he started to make waves on the Dublin scene, snapping up a 33 per cent stake in the Shelbourne Hotel on St Stephen’s Green.
That was then; this is now. Tomorrow morning, Sweeney will go to the High Court in Dublin in a bid to stop his business from unravelling into insolvency. Laden down with debts, and with his largest creditor breathing down his neck, Sweeney will seek bankruptcy protection for his main company, Black Shore Holdings, and four subsidiaries.
February 8, 2010, 1:00am
The other problem complicating an examinership was detailed in the first link
According to the report, Sweeney’s company and the other Shelbourne shareholders provided a ‘‘
joint and several guarantee’’ to Anglo Irish Bank and Bank of Ireland for the borrowings of Shelbourne Hotel Holdings and a related company, Zambrook
And they won’t be getting any wonga off Bernard!!
February 8, 2010, 2:35am
According to an independent accountant’s report, submitted to supp or t the examinership application, Black Shore’s assets have a book value of €42.8 million, but would be worth just €810,000 in the event of the firm being wound up.
WTF? how can these assets have a book value in excess of 5000% of their realisable value? Wat relevance has the book value in that instance?
thepost.ie/newsfeatures/swee … 47243.html
February 8, 2010, 10:59am
He must be losing lots of money on the Courtyard Mariott (Headford road). I live near there … saw it go up in the boom, the big retail space beside the hotel is leased occasionally to Lidl to get rid of stock (saw mister fishy Frank Fahy there yesterday… conspiracy theory anyone). The hotel has never been busy … the offices are empty and as I said the retail space goes to Lidl now and again (oh and statoil pulled out of the service station)
archives.tcm.ie/businesspost/200 … 913432.asp
“It is believed that some of the hotels were sold to investors who wanted to take advantage of certain tax breaks. Thehotelswerethen leased back to the Sweeneys, who operate them.
With strong cashflow from his oil business and strong asset backing in a rising property market, Sweeney has not found it difficult to raise funds for further projects.
People who have met him say that he is not at all riskaverse and will happily borrow against one business to fund further expansion ambitions”.
He is involved in two projects with a combined value of more than €40 million. The first is a €25 million office, retail, hotel and commercial development under construction at the Headford Roundabout in Galway.
February 8, 2010, 11:57am
They pulled out of Ireland, now if you said that the service station has been closed since it went to Esso that would be different. It is relatively well located.
February 8, 2010, 12:15pm
Yes statoil pulled out and the Esso is owned by Sweeney! My point is he cannot lease much out of that development.
February 8, 2010, 12:40pm
Very true, he never got anywhere with the retail units on the ‘town’ side of it. Mind you they face the tattiest block of shops in Galway and look ever so incongrous there
It’s almost a setup for a pratfall!
February 8, 2010, 3:43pm
Inside the empty world of Ireland’s zombie hotels
irishtimes.com/newspaper/opi … tml?via=mr
The Burlington always had a slightly Soviet air about it – I think it is that chandelier in the lobby – even though our own political parties were fond of it, and held their jamborees here. Now you can get a room for €79 (remember this is a Friday, peak time) without breakfast, and for €105 with breakfast, for two people. You could revive your marriage. The receptionist has that post-boom charm about her. How many rooms does she have? “Five hundred,” she says.
Zombie hotels, zombie hotels. Uncle Fester on the piano every afternoon for the tea dances.
The Berkeley Court is much quieter – old men are being helped to the bar, the executives are gone. In the function room white tables sit waiting for some rugby dinner – a big match beckons.
The Berkeley Court is still hiring out smaller function rooms – a lawyer friend of mine worked here last week. If you wanted to sleep here you could have the Double Deluxe type of room for €69, €89 with breakfast, and you could have a junior suite for €119 – less during the week.
A shoebox B and B in Drumcondra would cost nearly that if not precisely that …but it can’t last, at least not much beyond the International Rugby season it can’t
February 8, 2010, 4:49pm
I had a look at the last Black Shore accounts filed.
Levered up to the hilt with little profits and capital and reserves that mainly comprise revaluation reserves.
Plethora of banks involved - AIB, Anglo, UB & BOSI. The wind up will be fun.
PG’s of course. To what extent not disclosed.
scribd.com/doc/26561606/Blac … 8-Accounts
February 10, 2010, 1:42pm
I sorta felt sorry for the guy when I read this:
In a sworn statement to the court, Mr Sweeney said he had devoted his whole life to the businesses. He said he was a non-smoker, non-drinker and a non-golfer and every resource he had had gone into the group.
He said he had borrowed personally and invested in the group and had taken a modest salary and lived a modest lifestyle.
He also said he had made costs savings over the past year and a half and that staff had taken voluntary pay cuts and were willing to take further pay cuts to ensure the businesses survive.
But then I thought, well … he probably has a gambling problem???
full story on:
February 10, 2010, 1:45pm
Or maybe a greed problem.
April 2, 2010, 8:17am
BANK OF Ireland believes well-known Galway businessman John Sweeney may have secretly attempted to enrich himself by hiving off funds that were due to the bank under a €10 million judgment against him.
Barrister Jarlath Ryan told the High Court yesterday that the bank had a suspicion there was fraud involved in Mr Sweeney’s switching of funds to two companies in which he had failed to disclose any interest.
Mr Justice John Edwards granted to the bank ex parte injunctions restraining Mr Sweeney from reducing his assets below €10 million and directing him to disclose all assets in which he has an interest in Ireland.
The bank also obtained an order directing Frank Brennan and Frank Brennan Taxation Consultants, as liquidator of Tidevale Ltd or Connemara Livestock Sales Ltd, to reserve all liquidated funds of the companies towards the bank’s judgment.
irishtimes.com/newspaper/fin … 48176.html
Sweeney salvage bid due in court
EFFORTS TO salvage part of the business empire of John Sweeney, the Galway entrepreneur who bought a stake in the Shelbourne Hotel, will move back to the High Court next week after a rescue bid aimed at taking four companies out of examinership was opposed by the businessman’s largest creditor, Anglo Irish Bank.
The court-appointed examiner, Michael McAteer, is to seek to push through a rescue package for two of the firms next Wednesday, while the other two companies, which control the Marriott Courtyard hotel in Galway and two petrol stations, are likely to be placed in receivership.
All four firms are subsidiaries of Mr Sweeney’s insolvent Black Shore Holdings firm, and between them employ 140 people in the oil, property and hotel sectors.
irishtimes.com/newspaper/fin … 76883.html
All work and no play make John a dole boy