€7.8m hotel once valued at €70m

A four-star hotel in Galway city once valued at €70m now has a book value of only €7.8m after a series of writedowns.

Galway developer Gerry Barrett purchased the Meyrick in Galway’s Eyre Square in 2006 along with two other Great Southern Hotels from the Dublin Airport Authority for a reported €130m, later selling the Killarney-based hotel for around €40m.

ML Meyrick Ltd wrote down the value of its hotel property asset by €50m in 2009 and by a further €10m in 2010 and now, new accounts for the company that owns the Meyrick show the value of the hotel was further written down from €10m to €7.8m in 2011.

The filings lodged by ML Meyrick Ltd to the Companies Registration Office show the writedown contributed to the firm recording a loss of €2.1m in 2011. This left the firm with accumulated losses of €72.9m at the end of December 2011. The accounts disclose ML Meyrick owes €80m to group companies.

A number of loans from Mr Barrett’s firms were transferred to Nama in 2010 and the filings confirm he is confident draft terms of the debt restructuring plan issued will be agreed.

Figures lodged by a connected firm, KH Kitty Hall Holdings Ltd, show it incurred a loss of €10.4m in 2011 with accumulated losses increasing from €150.7m to €161.2m in 2011.

Separate returns lodged by Barrett’s Niche Hotels that operates the G Hotel record that the hotel was also loss-making in 2011.