Newcastle hotel owners loaned £15m for 'financial restructure'
The owner of a hotel in Newcastle has received a £15m loan from the city’s council.
Clouston Group, which owns the Crowne Plaza Newcastle, agreed on the loan in 2019 as part of a financial restructure.
The group had previously borrowed £15m from the council in 2013 for a the regeneration of the Stephenson Quarter.
The latest loan was outlined in the council’s financial reports but had not previously been publicly disclosed.
Richard Clouston, CEO of Clouston Group,, commented: “The loan, agreed in 2019 by all stakeholders, was part of a planned financial restructure to build upon existing success and continue to drive forward the Crowne Plaza as one of Newcastle’s highest performing hotels.
““This included the appointment of leading global management company, Interstate, to optimise performance.
“Consistent, excellent results are being achieved contributing significantly to the local economy.
“The trajectory is wholly positive and we are most grateful to our diligent staff and management.
“We work closely with our colleagues at Newcastle City Council and all monies are repaid regularly in accordance with arrangements made.
“We look forward to future phases of Stephenson Quarter, working with Newcastle City Council and joint venture partners to ensure the site’s potential is achieved.”
Speaking to the Chronicle, a council spokesman added: “The council agreed to loan £14.8m to the hotel owners Stephenson Hotel in 2019 as part of a planned refinancing package.
“The council initially loaned Stephenson Hotel £15m in 2013 to build the hotel as an anchor development for the Stephenson Quarter site which has gone on to create 1,000 jobs.
“The additional business rates generated have meant that the Council is able to further invest in the development of the site and support the creation of further jobs in the city.
“Both loans are now being repaid in line with the refinancing arrangement delivering interest payments above the cost of borrowing to the council, meaning there is no cost to the taxpayer.
“The hotel - under new management - is one of the best performing hotels in the city. “We continue to monitor the situation as we do with all our loan arrangements made in the city’s best interests.
“We are in the process of appointing a new development partner to unlock the rest of the site’s potential development and we are confident that as the Stephenson Quarter grows the hotel will go from strength to strength.”
Do you want to sell more to businesses in your region? Get Bdaily Marketing's latest Media Pack now to see how we can help →