Would-be hoteliers are being blocked from starting a new life in Blackpool due to the fallout from the banking crisis, it was today claimed.
The Gazette can reveal at least 165 centrally-located hotels, guest houses and B&Bs are up for sale within a one-mile radius of Blackpool Tower.
There is anecdotally no shortage of buyers willing to invest in the town, but they are unable to get the bank loans needed to fulfil their dream.
The perceived volatility of Blackpool’s hotel market and a nervousness from the banks over the leisure sector – including pubs and restaurants – is blamed for a lack of movement with some hoteliers stuck in properties they want to sell and would-be buyers left frustrated.
Financial commentators have already suggested there is a growing north/south divide in terms of lending.
In Brighton, there are just four hotels up for sale on the same popular national property website which lists 165 in Blackpool.
One commercial estate agent today said he feared Blackpool had become a lending blackspot.
Paul Crossley, managing director at Kenricks Commercial estate agents in Church Street said: “It’s worse now than it has ever been.
“We went through the recession in the 1990s – this is worse.”
Mr Crossley, whose firm has been selling hotels for almost 30 years, laid the blame firmly at the door of the banks.
He added:“There is still a desire to come here and run a hotel and people raise the 30 or 40 per cent deposit, but the banks simply won’t lend them the rest of the money.
“In the past there may have been some irresponsible lending but the would-be hoteliers of today are paying the price for the mistakes of yesterday which is incredibly unfair.”
Mark Smith, Director of Number One South Beach, agreed, adding he had just tried to buy a neighbouring property but the banks had effectively scuppered the deal.
He said: “We’ve been in the hotel business for 22 years. We run a successful business and have an impeccable track record. If they won’t lend to people like us what chance have newcomers got?
“The banks are supposed to be lending but they won’t even discuss it.”
Mr Crossley, who has more than 100 hotels currently on his books, added: “Maybe it’s just snobbishness because they’re still lending in the Lakes. But it just seems impossible to get a bank to help out in Blackpool.”
In the boom and bust days of just a decade ago banks were seemingly prepared to take a punt on operating values – the building itself and the value of trade – continuing.
That has been replaced with a reported nervousness to invest outside of London which is widely seen as a more secure risk when lending.
One banking expert told The Gazette: “I really cannot see the situation changing until banks get more comfortable with operating values being sustainable.
“London is an isolated case – business in this sector are seen to extend better values
“There is a combination of factors here, banks running scared and in some cases too high an expectation from business owners as to what their businesses are worth today compared to when it was bought years ago.
“It could be argued thatif you do have 40 or 50% of a businesses’ worth to put up are you going to invest that in a hotel in Blackpool?”
Coun Graham Cain, Blackpool Council’s Cabinet member for Tourism, said there should be no definition between a good business prospect in Blackpool compared to anywhere else in the country.
He said: “Blackpool’s got more to offer than any other seaside resort in the country.
“There maybe that prejudice but I don’t understand why, because everybody’s struggling at the moment.
“I know it’s difficult to lend money but the financial people need to take a second look at what Blackpool has to offer.”
Today, many of Blackpool’s accommodation owners say they are “nervous” about the months ahead.
Claire Smith, president of hotels and guest houses association StayBlackpool, said: “My real fear is not about Blackpool but the national economy. Last year I was optimistic and the resort had a great year – this year I am nervous. I think people are nervous and skint, everything seems to be going up.”