A five-star golf resort in Northern Ireland that has been in administration for over 18 months with debts of £26 million, and regarded as a high-profile example of the worst excesses of Ireland’s banking crisis, will play host next year to eight of the world’s richest nations.
David Cameron yesterday announced the choice of the Lough Erne resort in Enniskillen, County Fermanagh, as the main venue for next June’s G8 summit, saying “This will be a brilliant advertisement for Northern Ireland.”
The Prime Minister said Lough Erne was the “right place” to show the world that Northern Ireland was “great for business” and a “ great place for investment.”
Although administrators KPMG in Belfast have never formally put a value on the resort that was once valued at £30m, it is understood the current price tag is round the £10m mark.
Initially focused on the high end of Ireland’s boom in luxury golf properties, this week a night in the five-star hotel, plus a round of golf, could be bought for £99.
The comment by Mr Cameron that he would “not have trouble keeping President Obama off the golf course,” will do no harm to Lough Erne’s global reputation.
The Lough Erne property was the dream of Jim Treacy, a local retailer who made his fortune in businesses on both sides of the Irish border. He borrowed heavily from the Bank of Scotland Ireland (BoSI), and opened the 120 bedroom property, that also contains up-market lodges and holiday homes, in 2007.
Sir Nick Faldo was hired to design the signature golf course that runs through the 600-acre lakeside peninsula and forests.
The global downturn hit Ireland’s hotel sector badly, and the chaos that engulfed Irish banks made the situation worse.
Lloyds take-over of Bank of Scotland in 2008 resulted in its Irish division being closed and its loan book wound down. In 2009, Castle Hume Leisure, the company that controlled the resort, had net debts of 31 million Euros.
In 2011 when KPMG were called in, Mr Treacy said “£20 million of net debt is not a lot.”
According to figures produced by the Golfing Union of Ireland, over 100 new courses were built between 1995 and 2010. Many luxury-end properties, built enjoying tax breaks, went into receivership. The casualties, some market competitors to Lough Erne, include the Moyvalley Hotel in Co Kildare and The Heritage in Co Laois.
However Stuart Irwin, KPMG’s co-administrator of the property, described the outlook for Lough Erne as “positive”. He told The Independent “ We have been trading extremely well and we expect that the G8 will put the property on the map internationally.”
Mr Irwin would not reveal when Lough Erne was officially told they would hosting world leaders like Barack Obama, the US president, President Putin of Russia, and the German Chancellor, Angela Merkel.
With the UK chairing the G8 group of countries next year, Downing Street held an effective veto on where the gathering took place. In 2005, the last time the G8 was held on UK soil, another golf resort, the Gleneagles Hotel in Perthshire, was chosen as the venue.
Northern Ireland’s First Minister, Peter Robinson, thanked Mr Cameron for his decision, saying “This is a massive boost for us… the message will go out that Northern Ireland is not only a top visitor destination, but also a great place to do business.”