Mon, 29 Sep 2014 | ADMINISTRATION
Manchester property firm Blue Rainbow Apartments Limited has been sold in a pre-pack administration arrangement dealt with by Ben Woolrych and Russell Cash of FRP Advisory.
The move has secured the jobs of 39 people. However its sister company Blue Rainbow Hotels (Edinburgh) Limited was shut down on 16 September, the day before Blue Rainbow Apartments entered administration, with eight job losses. It subsequently was liquidated on 18 September after a failed plan to turn it around.
The business, which traded as Blue Rainbow Aparthotels, specialised in luxury services apartments and following a successful bid now belongs to City Space Hotels Limited, which has purchased Blue Rainbow Apartments’ business and assets to include the lease of 79 upmarket serviced apartments in a nine floor property in Manchester.
Speaking to Insolvency News, Mr Woolrych explained the reasons for the administration: “Despite strong occupancy rates, a recent policy of discounting room rates to generate cash in order to support the turnaround of the Edinburgh business had led to operational losses for the Manchester business.”
This, plus increasing overheads, put accumulating cash flow pressures on the business, which prompted the pre-pack administration.
The administrators have confirmed that the pre-paid deposits (totalling £200,000) for the apartments will be honoured.
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