Premier in name but not in turnover

THE PREMIER Inn in the Airside Retail Park in Swords, Co Dublin, saw an 18 per cent fall in turnover in the year to the end of February 2009, according to accounts filed recently.

The operator of the hotel, formerly known as the Tulip Inn, is PI Hotels and Restaurants Ireland Ltd, which was bought in September 2007 by the Whitbread group. The PI accounts, which show a pretax loss of €573,000 on a turnover of €3.3 million, state the company is operating as a going concern as its parent has committed to continuing funding.

The company has a commitment to an annual lease of €509,000, according to the accounts, and mortgages registered with the company show a link with AIB’s head of business banking in Galway, John Hughes, and others with whom he is involved in property ventures. Mr Hughes is the subject of an international AIB investigation into whether his business activities are in breach of the bank’s ethical guidelines.

Hughes, Michael Melville, Donal Dooley and Bernard Duffy, all with Galway addresses, acquired the Co Dublin property in January 2005, at which time a mortgage was taken out with Anglo Irish Bank, according to Land Registry files. The acquisition was part of a tax-based investment whereby the hotel was leased to its operator. Such schemes have a seven-year term during which they require the hotel to continue in operation. The fact Whitbread is such a large and profitable group should be of some comfort to the investors.

Hughes is involved in a number of property ventures with Melville and Dooley, who are directors of Oran Pre Cast Ltd, of Oranmore, Co Galway, a company that banks with AIB in Eyre Square. Duffy is the owner of the Galway-based TBD group, which banks with AIB as well as the Bank of Ireland, Anglo Irish Bank, and Bank of Scotland Ireland. TBD Group Holdings incurred a €2.18 million loss in 2007, according to its most recent accounts, having made a slightly larger profit the previous year. Turnover was €9.8 million, compared to €37.2 million the previous year.

Duffy is a member of the CWWB Partnership with Alan, Brian, Niall and John McCormack. In 2006, the partnership bought the former Siemens building in the Sandyford Industrial Estate with plans to build a €95 million complex with a 20-storey tower. An Bord Pleanála turned down the proposal.

TBD was involved in the construction of the Dockgate complex in Galway city. Hughes and the former head of Irish operations at Anglo Irish Bank, Tom Browne, own property in the Dockgate development which they lease to the Department of Agriculture.