THE Two Mile Inn Hotel is to close its doors on September 9, with a warning from Michael Vaughan, chairman of the Irish Hotel Federation, that others in the region could suffer a similar fate.
The Two Mile Inn, originally built by the late Tom Ryan, was later taken over by Brendan Dunne, after Mr Ryan developed the nearby Limerick Inn, now the Radisson.
It had in its time been one of the most successful hotels in the Limerick-Clare area, hosting many major events, including Limerick area finals of the Rose of Tralee.
It was also hugely popular with tour operators.
A staff member confirmed to the Limerick Post that closure was set for September 9.
The Two Mile Inn was an Ennis Road landmark and its pyramid top won architectural recognition.
Limerick is still one of the most “over hoteled” in the region and needs a comprehensive plan for survival, warns Clare’s Michael Vaughan, chairman of the Irish Hotel Federation (IHF).
The knock-on effects of the decision taken by Bank of Scotland to quit Ireland were already being felt, said Mr Vaughan, whose views have been supported by a Limerick hotelier, who claims that up to 150 hotels have substantial loans with Bank of Scotland and are dependant on them for survival.
The Two Mile Inn closure is not related to the decision taken by Bank of Scotland.
The local hotelier, who asked not to be identified, pointed out that hotels had mushroomed in the region in the Celtic Tiger years, and in the main were driven by investors in search of generous tax breaks.
Mr Vaughan revealed that the bank holds 40% of loans for newly built hotels.
“This is a worrying time for the sector as no details of the wind down have been released.
“The Limerick/Shannon area is well exposed to loans with the bank. Hotels rely on long term relationships with banks as they often wait 15 to 20 years for return on investments.
“In the short term this change will see ripple effects because, as well as long term loans, Bank of Scotland provide working capital, i.e. upfront cash for the day-to-day running of the business”.
Mr Vaughan also said that the bank had provided overdrafts to help hotels survive the quieter winter months.
“These overdrafts are generally cleared by May or June but in recent years hotels often don’t manage to clear them and would look to Bank of Scotland to help out.
“No other banks will touch the sector so now we have no where to turn”.
