At least 100 hotels in Nama or receivership competing with healthy hotels for business. How to resolve this?
Where's the problem? I presume the NAMA and Certus hotels have EBITDA and throw off some cash.
If they are costing the banks cash they'll close them.
What the "healthy" hotels mean is that they want roomrate to increase so they'll get a "landlord return" above EBITDA for their own properties and spare cash for capex etc. Well tough luck. Your time for lobbying was 10 years ago or whenever the capital allowances game began.
It's a bit more complex than that.
There is a good chance that the banks would get hit for the balancing charge if the asset is closed/sold during it's tax life as the relevant interest in the property would transfer to them if they took security. So it's better to fund operating losses to avoid this.
Plenty of bank hotel are not making any positive EBITDA.
Put it another way. Is their overdraft increasing?
Are you telling me that the Certus chap in London who signs off on lending is letting a Certus hotel's overdraft increase.
The balancing charge thing is bit of a bogeyman. Why would the people who benefited from the capital allowance not be the ones who get hit with the balancing charge?
Genuinely I've no idea. Is there any evidence that a bank has been hit with a balancing charge on a tax break hotel it shut.