SCALLOWAY Hotel is to close with the loss of 17 jobs as a downturn in the oil and gas sector and the coronavirus crisis impacted its financial performance.
The company which operated the hotel has been placed into administration.
All employees have been made redundant with immediate effect.
The award-winning hotel – run by Caroline and Peter McKenzie – closed its doors earlier this month due to the coronavirus pandemic, but it will now not re-open.
The hotel was put up for sale last year but no buyer was found.
Joint administrator Stuart Robb said: “Despite having strong bookings in the tourist season, in recent years the business had experienced a significant reduction in turnover during winter periods, mainly due to the downturn in the oil and gas sector and increasing overheads. As a result, the company experienced cashflow difficulties.
“Unfortunately, having assessed the company’s trading and financial performance – and in light of the current Covid-19 pandemic – it is not possible to re-open the hotel and, as such, all 17 employees have been made redundant with immediate effect.
“We appreciate that this is disappointing news for the staff at what is already an unsettling time. We are working with Partnership Action for Continuing Employment (PACE) to ensure that those employees impacted by redundancy receive the best possible support.
“There remains an opportunity to acquire the hotel, and we would encourage any interested parties to contact Emma Cameron by email at firstname.lastname@example.org with a note of interest.”
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