The company that owns London’s Savoy Hotel widened its losses to £83m last year, thanks to a heavy debt burden and what it said were the effects of terrorist attacks in the city.
The Savoy Hotel Limited, which is ultimately owned by Saudi Arabia’s Prince Alwaleed bin Talal and the Qatar Investment Authority, made a loss of £83m in the year to December 2017, up from £61m a year earlier, according to accounts filed at Companies House.
The group, which forms part of a network of companies linked to Prince Alwaleed’s Kingdom Holding Company, said the landmark hotel had seen a notable drop in North American visitors after four terrorist attacks in the capital last year, including the Islamist attacks on Westminster Bridge and London Bridge that killed four and eight people, respectively.
The company said increases in the Savoy’s prices had been offset by lower occupancy during the second half of the year. The venue is operated by Fairmont, the hotel chain in which Kingdom Holding also has a stake.
But the group was also weighed down by high debt charges, including on loans made by related companies. It paid £88m in interest during the year. By the end of 2017, it was £558m in debt to a related company, Dunwilco (1784) Limited, the accounts said.
Turnover at the company dropped slightly, from £58m to £57m, a drop that it said also resulted from its restaurant, Simpson’s in the Strand, being closed for refurbishment.
The Savoy Hotel Limited is wholly owned by another company, Breezeroad, which in turn is 59 per cent owned by Kingdom Holding, with the remainder held by the Qatar Investment Authority.
The drop in the Savoy’s fortunes came despite what PwC, the professional services group, said was a “stronger than anticipated tourism boom” for UK hotels in the first half of 2017, partly thanks to a weak pound in the wake of the Brexit vote.
Revenue per available room, a figure known as revpar, rose 0.68 per cent, to £297 at the Savoy last year, far below the 6 per cent growth that PwC estimated for 2017 for the sector as a whole.
Prince Alwaleed acquired the historic hotel from a consortium of Irish investors in 2005, and carried out a comprehensive refurbishment at a reported cost of £220m, reopening the hotel in 2010.
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