Town hall chiefs are being asked to invest millions of pounds to help bring a four star hotel to the centre of Blackpool.
The scheme would see a £14m 130-bedroom Holiday Inn built on the site of the St John’s car park on Topping Street as part of the next phase of the Talbot Gateway.
Blackpool Council’s executive is being asked to consider borrowing at least £2.745m towards the project which it is claimed will bring a much needed uplift to the resort’s accommodation offer.
But existing hoteliers today branded the move a “kick in the teeth” for businesses already struggling to survive.
They warned there are already too many hotel rooms in the town and the cash should be used to help them instead.
Claire Smith, president of hoteliers group StayBlackpool, said: “If it was a five star hotel being proposed, like a Malmaison, I would be saying ‘great’, as that would not compete with what we have got.
“But we have got lots of good four star accommodation.
“So this is like a kick in the teeth for hoteliers. We already have enough beds in the town and if this kind of money is available, why not use it to benefit them.
“For example we would like to see some kind of compulsory licensing scheme that would upgrade all the hotels in the town.”
A report to councillors warns that without additional funding “the development of either a three-star or four-star hotel is not viable.”
Three options are on the table – for developer Muse to seek a third party investor which would require the council to plough in funding of £2.745m to make any scheme viable; to reduce the project to three star accommodation which would still require some level of investment from the council; or for the council to fund the full £14m development and appoint an operating company to manage the hotel on its behalf.
The council’s investment would be clawed back from future hotel profits.
But Michael Topping, of The Sutcliffe Hotel on Albert Road, Blackpool, said: “I think it’s very unfair to those of us that have already paid all their rates to the council. The money could be used to help the businesses who are currently trying to make a living.”
Graham Waters, of The Arabella Hotel, also on Albert Road, said: “There are enough good hotels in Blackpool without more being built to drive hotels out of business.
“It’s our money they are playing about with.
“Hotels are the council’s biggest money earners, with business rates and the drinks licences we pay for. If Holiday Inn wants to build a hotel in Blackpool, let them pay for it.”
Ursula Beswick, of The Redstone on Alexandra Road, South Shore, which boasts five stars, said: “I’m all for Holiday Inn coming into the town but I don’t think the council should be subsidising it in any form.
“The company is big enough to subsidise itself, and there are much better things for the council to invest its money in, ie our B&Bs.”
Nick Taylor, manager of the four-star Hilton Hotel in Blackpool, said he welcomed plans for a Holiday Inn.
He said: “We need more quality hotels in Blackpool and I don’t think there is enough four-star accommodation at the moment in the town.
“It would also help to attract better quality tourism and people with a bit more money to spend.”
Mark Wilson, managing director of Sleepwell Hotels which includes The Carousel on South Promenade, said: “While we are fully supportive of the on-going town centre development, and we can certainly understand the logic of having a critical mass of quality accommodation near to a dedicated conference centre, what is absolutely clear and fundamental is Blackpool does not need any more hotel rooms, but a first class, purpose built conference and event venue to assist in filling the existing number of hotels as it currently stands.”
Holiday Inn is part of the Intercontinental Hotels Group. The proposed hotel would be managed by a third party hotel management chain such as Kew Green who already have several Holiday Inns.
Coun Tony Williams, leader of the Conservative group on Blackpool Council, said he was concerned the council was proposing to borrow such a large sum at a time when reserves were low.
He said: “There is no mention on financial forecasts as to how much the council would receive in profit share from the venture based on guest stays etc, or how long it would take to pay back this debt.
“Should the council be entering into this sort of partnership when the hotel industry is very unstable with discount chains competing for business and ownerships changing weekly?”
But Coun Simon Blackburn, Leader of Blackpool Council, said: “This announcement has been a long time in the making and is a massive step forward in terms of revitalising Blackpool town centre and giving us the ability to compete to attract national and international conferences and events.
“This has been part of our plans for the Talbot Gateway Central Business District site from the outset and it’s pleasing, given the successful completion of phase one, that we’re now in a position to move to phase two.
“The plan for a four-star hotel has been known about for more than eight years so I’m sure it will not come as a surprise to anyone.
“Blackpool’s motto is progress and this is undoubtedly that.”
The council’s executive committee meets on Monday.