Interim managers appointed to Virgin Hotels Glasgow in administration process as sale considered

An administration process has started for Lloyds Development Limited, the owner of Virgin Hotels Glasgow, a new landmark building by the Clyde.

Virgin Hotels opened its second European property in Glasgow on 18 August after officially opening in Edinburgh in March of this year. The completed lower floors of the city centre hotel include its flagship restaurant and bar, Commons Club.

Upper floors with a series of suites were not completed for the launch of the hotel. A whisky bar set to boast 'one of the finest whisky collections in Glasgow' was to be introduced as part of the next phase of building work - the space is sealed behind a temporary wall in the foyer.

Virgin Hotels Glasgow was initially scheduled to launch in summer 2022 before being delayed until December last year, then eventually opening the lower floors and welcoming guests to some of the projected 242 bedrooms in August. The hotel operator say the property has performed as expected since opening.

A Virgin Hotels spokesperson says: “We can confirm an administration process has started for Lloyds Development Limited, the current owner of Virgin Hotels Glasgow. Geoff Jacobs and Blair Nimmo of Interpath Advisory have been appointed as interim managers of Lloyds Development Limited. It is, however, very much business as usual for the hotel and our team, and we look forward to continuing to welcome guests and build on the hotel’s success.”   

They added that each Virgin Hotels brand has an independent owner with Richard Branson's brand operating the property under a hotel management agreement: "This administration process is purely about the capital structure of the property." A number of staff have left the business in Glasgow in recent months. Virgin Hotels state that there have been no redundancies, some former employees dispute the circumstances under which they left their jobs.

The company that owns the hotel building, Lloyds Developments Ltd, is part of a limited liability partnership of four designated members. They are Richard Diamond and Rishipal Singh alongside Lloyds Development Ltd with a registered address in Guernsey and Moreply Ltd, registered in London. All four partners were appointed on 18 May 2017.

Richard Diamond and Rishipal Singh were also directors of two hotel development companies, Tribe Glasgow Ltd and Tribe Glasgow (OPCO) Ltd that were dissolved in 2021.

Administration proceedings began for Lloyds Developments LLP in the High Court of Justice, Business and Property Courts of England and Wales, Insolvency and Companies List on 30 November.

The most recent financial statement of the partnership covered the period ending 31 May 2022. Loss for the year before members' remuneration and profit shares was £3,900,091. In 2021 the company recorded a profit of £20,299,828.

Fixed assets were listed as investment property of £77 million. Creditors with amounts due within one year were £6,127,281 with liabilities due after more than one year of £48,692,258.

Katy Broomhead of Interpath Advisory told GlasgowWorld: "Blair Nimmo and Geoff Jacobs from Interpath Advisory were appointed interim managers of Lloyds Developments Limited on 1 December 2023. The Company is the owner of a property located at 246 Clyde Street in Glasgow. The property is currently occupied and trading as Virgin Hotels Glasgow. The hotel continues to operate and we understand trade as usual.

"The interim managers are fully committed to working with Virgin Hotels and other stakeholders to ensure there is no disruption to operations at the hotel, while they assess options to bring the property to market in due course."