Hotel in Receivership

littlejp

One possible Hotel we are looking at for our Wedding Reception is currently in Receivership.
Would I be right in thinking that the next step is Liquidation, which would mean tough luck to anyone that has paid them money?
We haven't booked or paid anything yet but we really like the place and are thinking about it. Would we be crazy to book now? Is it a huge risk?

ThePiedPiper

The next step isn't necessarily liquidation, it probably won't be in fact.

In a lot of these situations, the receivor continues to run the hotel as a going concern. However, there is also the possibility that the company could be wound up.

If I was you, I wouldn't be paying over any deposits to such a hotel at the moment. In fact, when we got married this year, I contantly refused to pay the "stage payments". There are a lot of hotels out there looking for business so do not tie yourself to one of them that may go out of business. By all means, book the day with the hotel without paying a deposit if possible but keep your options open and have a Plan B.

Best of luck with it.

D3PO

OP liquidation isnt the next step per se.

If a hotel is in recievership already and you have yet to pay a deposit your only concern is finding a new venue if they close up.

Legally you become a secure creditor so are insulated against any financial loss.

Genearlly if a business is put into recievership and not examinership its becasue theyre is a reasonably good change that a new buyer will be found for the business and their is belief that it can be run as a profitible going concern.

Skipperm

breach of 2/20 rule

moco

One of the hotels I had in mind for my wedding has rumours going round about going into liquidation so it's put me off.

Personally I would look for another hotel. I think with wedding planning we have enough to worry about without stressing if the hotel will still be in business by the time the wedding comes round.

Rew

I wouldn't be as worried about liquidation as I would standards slipping and corners being cut. If money is tight it can effect staff moral and the quality.

ana_conda

Wedding insurance should cover you if the hotel went bust so I would invest in some insurance if you are thinking about booking this hotel.

But the problem isn't just a financial one. It's also the hassle of booking another hotel, possibly at the last minute and notify all your guest of the changes. I would continue to shop around before you place a deposit.

Toto Wolfcastle

ana_conda wrote: »

Wedding insurance should cover you if the hotel went bust so I would invest in some insurance if you are thinking about booking this hotel.

Are you sure about that? I thought that if the hotel is in receivership when you book it the insurance wont cover it?

ana_conda

Bobblehead Panda wrote: »

Are you sure about that? I thought that if the hotel is in receivership when you book it the insurance wont cover it?

Oh good point I didn't think of that ....:o sorry

Based on possible insurance problems I really would think long and hard about booking this hotel.