The Shelbourne Hotel, arguably still the best-known hotel in Dublin, faces receivership after the collapse of a rescue package for its debt-ridden British owner, writes Edward Power.
The hotel on Dublin's St Stephen's Green, where society ladies took afternoon tea as the 1916 Rising raged outside and where Michael Collins later oversaw the drafting of the 1922 Free State Constitution, is expected to be put into administration in a technical manoeuvre to allow Royal Bank of Scotland (RBS) recover ownership from the Le Meridien hotel chain, according to bank sources.
However, staff and patrons can be assured the move is a book-keeping measure which will not affect the day-to-day running of the Shelbourne, conservatively valued at €100 million.
RBS, which bought the Shelbourne and 10 other Le Meridien hotels, including London's Grosvenor House and Waldorf, in a 2001 sale and lease-back deal, regards the hotel as a prestigious acquisition and is already sounding out hotel groups to take over its management.
Though unwilling to comment officially, sources said the Shelbourne will be put into receivership over the coming weeks. But its survival is not in question, they stressed. "The Shelbourne will continue to operate as normal. We've already had considerable interest from parties with a view to managing it," the sources said.
Uncertainty is nothing new to the Shelbourne, which has had an eventful history since first opening its doors nearly 180 years ago. Established in 1824 as a retreat for Dublin's landed gentry, the hotel was long a celebrated haunt for the capital's business and political elite, often to be found hatching conspiracies and trading gossip in the smoky confines of the Horseshoe Bar.
But its profile has dimmed of late as hip designer hotels such as the Clarence, owned by U2, stole some of its thunder.
The Shelbourne has changed hands on several occasions, passing into British ownership in 1960. Two years ago it was one of 11 Le Meridien hotels sold to RBS in a €115 million sale and lease-back agreement. Saddled with an estimated debt of €1 billion, Le Meridien has been unable to strike a deal with creditors to allow it pay rent overdue to RBS, paving the way for the bank to assume control of the Shelbourne.
Bank to take control of Shelbourne hotel chain: page 15