McGettigan's hotel group in talks with bank over €67m loan
A property investment firm owned by Donegal hotelier Jim McGettigan is in talks with AIB about its 67 million borrowings after a repayment deadline expired.
Bonnington Group's loans were due to be renewed or repaid by November 30th, but the date passed without a renewal being agreed.
AIB has not sought repayment of the loans, but the Sunday Business Post has reported that McGettigan's group warned that it would ‘‘cease to be a going concern'' if it could not renew its banking facilities with AIB or find a new source of funding.
The directors of Bonnington, which has hotels and other properties in Ireland, Britain and Dubai, said they ‘‘expect that a formal renewal of the facility will be agreed'' with AIB.
The bank holds a legal charge over the group's properties and the assets of four group companies, as well as an ‘‘unlimited cross company guarantee'' to several other firms.
Through Bonnington, McGettigan also owns interests include the Regency and North Star hotels in Dublin ,the Royal Hotel in Bray, the Cavendish Hotel and Bonnington Rooms in London, and Bonnington Jumeirah Lakes Towers in Dubai. The 73-year-old Kilmacrennan native was Donegal person of the year in 2004.
The Bonnington group is also developing a 300-bed four-star hotel and business park at Gillette Corner in west London.
According to new accounts, Bonnington had turnover of €2.4 million in the nine months to the end of 2009, and made a loss of €3 million. The company said the losses were due to loan impairments, exchange rate fluctuations, interest costs on the Gillette Corner development and losses ‘‘following an abortive project in Glasgow''.
However, the accounts do not include the results from the group's interests in Dubai, which include land at Jumeirah Village. It was intended for a large commercial and residential scheme, but Bonnington pulled back from the project in 2008 and put the site on the market. It is considering plans for the land ‘‘with a view to generating operating profits''.