A 55-bedroom hotel overlooking Donegal Bay, which was once on the market for €4.5 million, has sold at an auction of distressed property for €650,000.
The Sandhouse Hotel in the popular seaside resort of Rossnowlagh had been billed as the star lot in today’s Allsop/Space auction in Dublin’s Shelbourne Hotel.
However, the hotel, which was put on the market by direction of its liquidator KPMG, attracted considerably less interest than expected.
After a short bidding race, the property sold for its reserve price of €650,000, a fraction of what its former owners thought it was worth at the height of the boom.
The picturesque property was bought by the hotel’s current manager Paul Diver, who has managed the hotel for the last 20 years. “I just can’t believe it. It’s a total adrenaline rush. It’s been a long, long road but we’ve made it.”
When asked if he was surprised by the lack of interest, Mr Diver quipped: “No, I was delighted”
The auction, which is the first of five planned Allsop/Space auctions scheduled for 2012, contained 100 lots of property, ranging from rural cottages to sleek city centre apartments.
Organisers said they expected about 2,000 people to attend the event during the course of the day.
About two-thirds of the properties are being sold by direction of receivers, reflecting the catastrophic collapse of Ireland’s once robust property sector. The remaining third have been put up for sale by private individuals.
Director of auctions at Allsop/Space Robert Hoban said: “At every auction the percentage of private vendors is increasing as more and more people want to put their properties out on the open market.”
On whether the auction reflected the open market value of Irish property, Mr Hoban said: “We don’t decide the sale price or value of the property, we let the punters decide where property value is and let them decide whether the market is going up or down.”
Over four sales last year, Allsop/Space sold over €52 million worth of distressed property assets, about 92 per cent of the total lots for sale.
Bank of Ireland had a stand the event today for the first time, offering mortgage applications to customers looking to bid at the auction.
