The future of the luxury Raithwaite Estate at Sandsend hangs in doubt after the firm behind the development went into administration.
KPMG said it was “assessing the financial situation” of the Estate which is owned by Skelwith Leisure (Raithwaite) Limited - a subsidiary of The Skelwith Group.
A new buyer is now being sought for the development which includes the hotel, holiday cottages and The Keep annexe over 100 acres.
In the meantime a spokeperson for KPMG said: “Our initial priority is to ensure that the business trades as normal, with clients being unaffected and their commitments being honoured, while we assess its financial situation and consider our next steps.”
Earlier this week Skelwith Leisure, another subsidiary of the Skelwith Group, went into provisional liquidation blaming costs of a legal dispute over the ownership of the land at Flaxby Golf Course.
On Wednesday, prior to the Raithwaite announcement, a Skelwith spokesperson had said: “Because of the pressure and resources taken up with the litigation on the Flaxby Golf course site, one Skelwith company, Skelwith Leisure, has gone into provisional liquidation. We are working with the liquidator to resolve outstanding issues. The current legal dispute and planning process will continue. This does not affect other Skelwith companies and projects and we still own various sites that we will continue to operate and develop as planned.”
The company will next week do battle with the farming family, the Armstrongs, who sold the land in 2008 at the High Court after they became angry with the changes to the masterplan, and a lack of building work to date.
A spokesperson for the Skelwith Group insisted both the High Court hearing and the planning application for a new town, complete with 2,213 homes shops, primary school, restaurants and a doctors’ surgery, will go ahead.
He said: “Because of the pressure and resources taken up with the litigation on the Flaxby Golf course site, one Skelwith company, Skelwith Leisure, has gone into provisional liquidation. We are working with the liquidator to resolve outstanding issues. The current legal dispute and planning process will continue.”
Flaxby was set to become the jewel in Yorkshire’s tourism crown when the Skelwith Group first proposed the £100 million country resort complete with 300-bed five star hotel and a golf course.
Despite selling 158 rooms in the luxury hotel to investors, including England’s former cricket captain Michael Vaughan, work on the hotel, granted planning permission in 2010, ground to a halt shortly after builders finished work on the £4 million roundabout near the A1 in 2014.
In November 2014 the Skelwith group announced new plans to build 2,500 houses on the 280 acre site, scrapping the golf course which it said was not profitable.