Owners of luxury Whitby hotel put into administration

A luxury hotel on the North Yorkshire coast could be sold after its owners went into administration.

Raithwaite Hall
Raithwaite Hall

Skelwith Leisure (Raithwaite), which owns and operates Raithwaite Hall, between Sandsend and Whitby, has been placed into the hands of two administrators at KPMG.

It comes two days after Skelwith Leisure, a separate firm and part of the York-based Skelwith Group, revealed that it had gone into provisional liquidation, blaming costs of a legal dispute over the ownership of the land at Flaxby Golf Course near Knaresborough.

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Skelwith Leisure and a third firm, Skelwith Leisure (Raithwaite Cottage), are now under the control of provisional liquidators Adrian Allen and Mark Wilson of Baker Tilly after a High Court order was made in response to a winding-up petition by HM Revenue & Customs.

It is understood that Depa, a furnishings firm based in Dubai who were involved in the design of Raithwaite Hall, have also applied for a winding-up order, and that the case will be heard at Leeds County Court on September 8.

KPMG, administrators for Skelwith Leisure (Raithwaite), said the luxury hotel a short walk from the cliff-tops of Sandsend was “continuing to trade under the control of the joint administrators whilst a buyer is sought”.

Jonny Marston, joint administrator and KPMG Restructuring partner, says: “Our initial priority is to ensure that the business trades as normal, with clients being unaffected and their commitments being honoured, while we assess its financial situation and consider our next steps.”

The liquidators of Skelwith Leisure, the firm behind a proposed multi-million pound hotel and golf complex at Flaxby, expect to issue a further update about the company at the end of a civil case which starts on Monday.

The company will do battle with the farming family, the Armstrongs, who sold the land to Skelwith in 2008, at the High Court after they became angry with the changes to the masterplan, and a lack of building work to date.

A spokesperson for the Skelwith Group insisted earlier this week that both the High Court hearing and the planning application for a new town, complete with 2,213 homes shops, primary school, restaurants and a doctors’ surgery, will go ahead.

He said: “Because of the pressure and resources taken up with the litigation on the Flaxby Golf course site, one Skelwith company, Skelwith Leisure, has gone into provisional liquidation. We are working with the liquidator to resolve outstanding issues. The current legal dispute and planning process will continue.”

Flaxby was set to become the jewel in Yorkshire’s tourism crown when the Skelwith Group first proposed the £100 million country resort complete with 300-bed five star hotel and a golf course.

Despite selling 158 rooms in the luxury hotel to investors, including England’s former cricket captain Michael Vaughan, work on the hotel, granted planning permission in 2010, ground to a halt shortly after builders finished work on the £4 million roundabout near the A1 in 2014.

In November 2014 the Skelwith group announced new plans to build 2,500 houses on the 280 acre site, scrapping the golf course which it said was not profitable.