Private property developers turned hospitality and accommodation group, Virtical, has had receivers appointed in an effort to recover debts.
It’s major financier, Bond Finance, has called in BRI Ferrier’s Peter Krejci and Andrew Cummins to take hold of the situation, and recoup debts.
Virtical made a splash into the Sydney hospitality scene 12 months ago, when it purchased the prominent Republic Hotel in Sydney’s CBD for $40m. It then kicked off a staged renovation of the venue, that began with a refresh of the ground floor public bar, and the creation of a late-night cocktail lounge on the second floor. Later stages of the renovation were expected to update the popular Taylor’s Rooftop Bar, before a big accommodation play under the Adelphi Hotel brand from Melbourne, which Virtical had also acquired.
Last week, Virtical agreed to sell the Republic Hotel at a loss to Thomas Hotels, for a reported $32m. With BRI Ferrier now having been called in as receivers, it was unclear whether the sale would go ahead.
However, Michael Thomas has confirmed to Australian Hotelier that Thomas Hotels would be taking over the hotel, but wouldn’t comment further at this stage.
Virtical also owns the Australasia Hotel in Eden, New South Wales, as well as the aforementioned boutique accommodation Adelphi Hotel in Melbourne, which it has relisted for sale 12 months after its acquisition. The group was also expected to buy the Metropolitan Hotel in Sydney’s CBD for $40m last year, but failed to settle on the acquisition.
Troubles for the group were first made public earlier this year, when a deal to buy Kinselas and Courthouse Hotel from MA Financial fell through and ended up in NSW Supreme Court. Virtical had agreed to buy the two Oxford St pubs for $61m, but attempted to back out of the deal. The Supreme Court ruled that Virtical were obligated to complete the deal, but it is currently appealing that decision.
Australian Hotelier had reached out to Virtical and BRI Ferrier for comment, but had not heard back at the time of publication.
The news of the appointment of receivers for Virtical’s assets follows on from similar news last week, with receivers from FTI Consulting appointed to the Sydney pub assets for Public Hospitality. The venues remain open as FTI Consulting looks to commence a sale of business campaign.
