Hotel chain 'victim of recession'

The Gables Hotel was bought by the McKever Group for £2m

Glasgow-based hotel chain McKever Group has gone into administration with debts totalling more than £100m.

Ally McKever said he was "devastated" the firm he founded in 1982 had become a "victim" of the recession.

The group employs about 600 people in 20 hotels, apartments and hostels in Scotland and the north of England.

Mr McKever said he was doing everything he could to safeguard staff jobs but expressed "deep concern" about the impact on homeless hostel residents.

The company, which paid £2m for the Gables Hotel in Gretna Green last year, borrowed nearly £70m from the banks to fund its upgrading and expansion plans.

There is also an outstanding tax bill of £4m owing to HM Revenue and Customs.

Ally McKever said: "It was the worst day of my business career when I had to ask the administrators to come in and run a business I've built up over 27 years."

'Going concern'

The group runs a number of hostels and flats used for housing the homeless in Glasgow.

Community groups have been highly critical of the company, complaining of anti-social behaviour from residents.

While there is confidence the hotels may continue to operate, there is a question mark over what will happen to the hostels.

Mr McKever said: "I think it will be a challenge to sell these on, because although it was less than 10% of my business, it gave me 99% of the publicity, which was all negative."

The accountants BDO Stoy Hayward have confirmed they have been appointed as administrators.

In a statement the company said: "All hotels are continuing to trade and will remain open while we conduct a review of the business with a view to securing a going-concern sale of the group."

The company's website is still taking bookings, offering a number of cheap deals.