THE renowned Lorne Hotel in the west end of Glasgow has been put up for sale as administrators take steps to liquidate its owning company.

Thirty staff were made redundant in May when administrators at Interpath Advisory, the former restructuring arm of KPMG, were appointed to Bellhill Limited.

The hotel, located in the fashionable Finnieston area on Sauchiehall Street, had been historically profitable. However, the business had seen turnover plunge and recorded trading losses in the 15 months following the outbreak of the coronavirus pandemic in early 2020, and the imposition of restrictions to halt the spread of the disease.

Administrators noted at the time that an “adverse legal finding” in May had left the director with “no other option than to place the company into administration”.

The hotel, which incorporated the award-winning Bukharah Indian restaurant and Bilberry cocktail bar, ceased trading when Bellhill went into administration.

In documents filed at Companies House, joint administrators Blair Nimmo and Alistair McAlinden of Interpath state that the “most likely” exit from administration for the business will be a creditors’ voluntary liquidation, adding that “we propose to seek appointment as liquidators”.

Documents show that the administrators have appointed property agent Christie & Co to market the freehold of the property, which had a net book value at appointment of £11.56 million.

“In tandem with Christies, we are currently preparing the hotel and collating the required information for the sales process, with the intention being to commence the marketing process shortly,” the administrators state.

According to the filings, the sole secured creditor of Bellhill on the appointment of administrators was the Bank of India.

The company had two term loans with the Bank, totalling £3.256m at the time of the appointment and subject to continuing interest and charges until they are repaid in full. The loans were secured by standard securities over the hotel, along with a first rank floating charge over the company’s business and assets.

“Based on the information on hand and subject to any unforeseen issues arising, we currently anticipate that the Bank will be repaid in full under the terms of the standard securities held,” the administrators state.

The administrators add that they expect to ordinary preferential creditors, including employees due wages, holiday pay and pension benefits, to be paid in full. These claims are expected to total £77,000. Secondary preferential claims estimated at £128,000, which include claims related to VAT, PAYE and National Insurance contributions, are also expected to be paid in full.

It is estimated that unsecured creditors receive a dividend, with the amount and timing still to be determined.