City hotel firm enters liquidation

The company running a high-profile Norwich boutique hotel has gone into liquidation after wealthy Russian backers pulled the plug on its finances.

The company running a high-profile Norwich boutique hotel has gone into liquidation after wealthy Russian backers pulled the plug on its finances.

The St Giles House Hotel is still open for business but the couple who built the venture - Lana and Carleton Van Selman - are no longer the owners.

A creditors' meeting is planned next week in Norwich for their firm, the Really Nice Hotel Company.

But the business is now being run by landlords Sutherland Walk Developments Limited, which is based in the East Midlands.

The EDP understands the initial company was forced into voluntary liquidation after it became unable to pay its rent on the property, leaving the landlords to take over the business.

Company-rescue expert Andrew McTear, who has been called in by the Van Selmans, said: "What happened was that money coming from Russian relatives of Lana Van Selman stopped some while ago and eventually, because of that, there was never going to be sufficient cashflow.

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"The business got into rent arrears with the landlord and the landlord has effectively taken over possession of the property, has set up another company and is now operating the hotel, while the Really Nice Hotel Company has gone into liquidation. The previous owners are still working for the company now running the hotel but they are not going to be directors of it.

"But when that happened, the company was fairly close to becoming profitable. It had been awarded four stars by the AA and had received a rosette for its restaurant."

St Giles House, in a historic building in the city, had undergone a multi- million-pound conversion under the guidance of the Van Selmans.

Lana Van Selman courted the media over the project, long before it opened in November 2005. TV companies had made fly-on-the-wall documentaries about the owners of the hotel, but it was an establishment constantly surrounded by claims of financial difficulties.

They had always been strenuously rejected by the owners and as recently as four weeks ago, Lana Van Selman was aggressively denying that there were any problems.

Mr McTear, a partner of the Norwich-based business rescue and insolvency specialist McTear, Williams and Wood, said his company had been instructed by the director of the Really Nice Hotel Company to assist and place it into voluntary liquidation from last Friday.

Last night, Ms Van Selman was putting on a brave face, saying it was "business as usual" at St Giles House, though with her now working as general manager rather than owner.

She confirmed her company had gone into liquidation and that there was insufficient funding from shareholders to continue but said existing staff had been transferred to the new operators.

She refused to discuss how she felt at losing control of the hotel she so often referred to as "her baby" and being relegated to general manager.

"I regard it as though I have just temporarily handed it over to someone else," she said, but would not say how she planned to regain control of the business. "It is unfortunate that the shareholders stopped financing the company because the hotel was starting to do quite well. It is just unfortunate that there was not enough start-up capital to carry it through and we are just having to deal with the current situation. But I know customers will still come through the door. Liquidation is just something that happened but we just have to face it and carry on."

The creditors' meeting for the Really Nice Hotel Company will be at the office of McTear, Williams & Wood at 90 St Faith's Lane, Norwich, on Wednesday at 11am.

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