Essex-based property investment company, Sterling Woodrow has been selling rooms at the popular 78-room four-star Llanelli hotel and spa to investors to be leased back to the hotel to let.
The company advertise the rooms at prices starting from £59,950 saying the rooms “have consistently high occupancy levels thanks to the 4.78 million visitors to the local area every year.”
It’s marketing literature describes the hotel as “a popular wedding venue with stunning grounds, wonderful local attractions and superb rail links”.
Investors could also look forward to “annual returns of 10% are paid quarterly in arrears and are assured for 5 years” according to the firm.
Things are not all what they seem however, following controversial plans to house upward of 200 asylum seekers at the hotel from July – resulting in the cancellation of weddings and hotel stay by worried guests.
The plans have been criticised by Carmarthenshire Council, Dyfed Powys Police and Crime Commissioner, Hywel Dda health board and local politicians, with the council stating that the venue is wholly unsuited for the purpose proposed and believe that to proceed further would require planning permission.
Llanelli MP, Dame Nia Griffiths has made repeated attempts to contact hotel owners, Sterling Woodrow, including at their Essex HQ and London Mayfair offices, but says she has been stonewalled by staff working there with no answers from the company forthcoming.
Now, the Furnace Action Group, formed after a public meeting to debate the asylum seekers plan say they are taking their concerns directly to Sterling Woodrow’s investors in the hotel.
The group have published a letter they have sent to individuals that have invested in Stradey Park Hotel through Sterling Woodrow warning them of the impact the asylum seeker plan will have on the hotel – and their investment.
In the letter, the group claim the “plan will lead to the loss of the jobs of the staff working at the hotel and has already led to the cancellation of a large number of weddings, large dinners, birthday parties and other such celebratory events”, adding that these provide “the bulk of income that the Stradey Park Hotel attracts, providing you with a return on your investment.”
The letter also claims that Sterling Woodrow and Home Office subcontractors Clearsprings “have not thought this through thoroughly and are playing a high risk game with your investment.”
It then calls on investors to “inform Sterling Woodrow you do not wish the Home Office plan to go ahead.”
The Furnace Action group go on to say they have “an investigative team working on this matter and anything we think that will be of note to you regards your investment we will bring to your attention to keep you informed and allow you to make an informed decision.”
Swansea Bay News have approached Sterling Woodrow for comment.
The letter from Furnace Action Group to Stradey Park Hotel investors in full
Dear Stradey Park Hotel investor,
We are taking this opportunity to brief you on some proposed changes to your investment at the Stradey Park Hotel and Spa in Llanelli.
We write to you as members of the Furnace Action Committee – concerned residents of the village of Furnace, home to the Stradey Park Hotel
You may be aware of plans by the Home Office to convert the hotel – currently a thriving going concern – into a centre for asylum seekers. If you are not aware, we respectfully ask that you search the news category on Google and you will find plenty of stories about the current row concerning the Stradey Park Hotel, including stories on the BBC and ITV.
The Home Office plan will lead to the loss of the jobs of the staff working at the hotel and has already led to the cancellation of a large number of weddings, large dinners, birthday parties and other such celebratory events. These events represent the bulk of income that the Stradey Park Hotel attracts, providing you with a return on your investment.
The contract proposal is between Clearsprings, acting on behalf of the Home Office, and Sterling Woodrow (Gryphon Leisure Ltd, the company with whom you have a lease). NB: Sterling Woodrow and Gryphon Leisure Ltd have the same directors.
MPs, Welsh Government members, council staff and councillors and agencies are against this proposal and are objecting at the highest level. The Welsh Refugee Council has objected to the plan. The hotel is already attracting a wide degree of negative publicity – on TV and radio, in newspapers and on social media.
Dame Nia Griffiths MP has asked a number of questions in the Houses of Parliament about this proposal, saying it is unworkable and will lead to the loss of the hotel as a going concern. There is also a loss of reputation for the hotel.
Your investment in the hotel was on the basis of it functioning as a four-star hotel in an area designated for tourism development.
The Home Office plan bursts the quality hotel bubble.
The change of use could happen in days. The Home Office has indicated that they will start moving people in from the 3rd July 2023.
There will be more than 240 people placed into 77 hotel rooms, as we understand the plan at present.
Some figures obtained even suggest as many as 300 plus will be housed at the hotel. Some in emergency communal areas, or in car park Portakabins, as has happened elsewhere in the country.
Attempts for further information on the plan are stonewalled by the Home Office and Clearsprings and Sterling Woodrow.
The UK Government has been using hotel rooms to deal with the increase in asylum seeker numbers for some time. It is known from evidence available online that at the end of the contract with the Home Office significant damage is left and costs incurred for repairs.
It is known that several hotels that have returned to “public” use have struggled to return to pre-contract bookings and income.
We are writing to you to make you aware of the implications of the proposal for the Stradey Park Hotel and Spa since it is our understanding from open-source research that you have invested significant funds into the Stradey Park Hotel.
Records show you have purchased a unit(s)at the hotel which consists of a bedroom. These bedrooms are the ones which will be used by the asylum seekers and will be used by at least three persons during the term of the stay.
There are legal steps taking place to stop this change of use.
It appears that Sterling Woodrow and Clearsprings have not thought this through thoroughly and are playing a high risk game with your investment.
We ask you, have Sterling Woodrow or their agents highlighted the following?
· Made you aware of their intention and contact with Clearsprings.
· Informed you how this will affect your contractual rights under your agreed leases.
· Any increase in return in investment from the change of use.
· Potential liability to yourselves for any breach of use by the persons who will be living at the address.
· Loss of long-term revenue when hotel returns to “public” use and reduction in value of investment.
· Current Government policy regards “out of hotels” which may mean this is only short lived however the repercussions on your investment would be long term.
· Those of you who within your lease have the option to stay will no longer be able to do so.
· That the permitted use on your lease may no longer be accurate “use as a hotel for short term occupancies”.
· Not to use the Premises for …any purpose …that would cause….nuisance or inconvenience to…other tenants or occupiers of the Estate or any owner or occupier of neighbouring property. Could this clause open you up to litigation from nearby properties?
We would ask that you conduct some urgent enquiries to ensure the following-
· That you can protect your investment.
· Identify your liability for costs from damage caused after change of use.
· Your liability for any breach by change of use or activity of the new “residents”.
· Your liability for litigation from neighbouring properties.
The way in which this may be sold to you by Sterling Woodrow and their agents is that there may be increased rental when the asylum seekers are there. However, the UK Government is actively trying to reduce the numbers in hotels. There will be continued pressure on them to close this down as use as an asylum centre and return to its intended use ASAP.
We are extremely concerned what impact a change will have within a community where services are already stretched. A large percentage of locals have already indicated should this go ahead they will no longer use the hotel and as such its long-term viability is questionable.
The Welsh Government is a devolved power and is not pleased with this change of use imposed on it by UK Government and loss of vital revenue into the local economy and as such will also be enforcing any breach of planning or health and safety.
This could mean any short-term increase in any promised revenue could quickly be lost.
The ideal option for your long-term investments as owners is to inform Sterling Woodrow you do not wish the Home Office plan to go ahead.
As concerned residents and customers of the Stradey Park over many years, we ask you to consider this very carefully and do your “due diligence” – something which it is clear the Home Office, Clearsprings and Sterling Woodrow have not done.
We have an investigative team working on this matter and anything we think that will be of note to you regards your investment we will bring to your attention to keep you informed and allow you to make an informed decision.
Furnace Action Group
(Lead image: Stradey Park Hotel)
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