The man in charge of bringing a branch of upmarket hotel chain Malmaison to Dundee says the development remains on course to open next summer despite ”hard going” in the marketplace.
Chief executive Gary Davis said the city’s prominent new 91-room hotel will open for business in July next year, creating a city landmark.
But he admitted that the company is facing tough conditions as parent MWB Group Holdings used a trading update for the first three months of 2012 to warn of an ”extremely challenging” time in the hospitality industry.
”Generally business is still hard-going in terms of the economy,” Mr Davis said. ”We’re doing well to maintain a little bit of a pick-up, but we’re mindful of the fact that the economy is very tough.”
MWB said it had made a string of changes at boardroom level since reporting a £15.8m loss between July and December, and was preparing to embark on a drive to raise additional capital. The hotel business which also includes the Hotel du Vin chain lost more than £7.2m during the last six months of the year and took steps to reduce its debt by around £100m.
Thursday’s statement to the markets said the firm is continuing its focus on reducing debt levels and raising capital.
However, it also pinpointed the announcement of the highly-anticipated Dundee site, at the former Tay Hotel, as a particular highlight.
Malmaison signed a 35-year operating lease with developer MEC Services earlier this year, with the new premises expected to create around 120 jobs.
Mr Davis said: ”Builders are on site and we are currently working on our internal designs for bedrooms and the restaurant and other public spaces.
”Dundee is our first new hotel for three years so, while we’re still going to keep the same Malmaison feel, it will be very much today’s look rather than the designs of a few year ago.
”It will still have the DNA of a Malmaison hotel, but of what one should be in the future.”
MWB also praised the Malmaison’s new management team for their positive impact, including efforts to raise occupancy levels, room rates and earnings, whilst challenging costs.
”Their efforts to maximise occupancies and revenues and to manage the cost base are already making a difference,” the MWB statement read.
Malmaison has also simplified its regional management structure.
Meanwhile, the group’s Bistro du Vin restaurants will be sold after continuing to accumulate losses since launch nine months ago.