Ulster Bank invested a lot of its money in hotels during the boom period but now cannot take this money out because of oversaturation of the market. The bank has however come up with an ingenious idea to have a chain of hotels of its own.
This will be the largest chain of hotels in entire Ireland. This is a project that will involve an investment of 600,000 Euros with the money equally shared by the bank and the owners of Hilton. Thus it will be a JV between Royal Bank of Scotland (Ulster bank parent) and Michael and Taylor (a company of Sir David Michel, owner of Hilton).
According to a report published in Sunday Independent, the name of the chain of hotels is going to be The Collection (as told by Hugh Taylor, the chief executive at Michel and Taylor). The head office of the company will be set up in Ireland with a small team for the front office. Already, a branding agency based in Dublin has been hired to make a strategy for the promotion of the new company.
The owners of the hotels will remain in place though they will be trained in a centralised procurement and reservations system. At the start, there will be around 25-30 hotels in the chain that will be looked after by Ulster Bank.
Taylor says it is still not clear which hotels will be a part of this chain of hotels. But Ulster Bank is a major creditor in many hotels such as Jurys and Burlington in Dublin. Taylor feels that the business of the new venture will be smoothly running by the end of the next year. Ulster Bank lent heavily to hoteliers some time back but cannot seem to get its money back because of the distressed hotel business.