Isle of Wight hotel owners walk away from seafront investment

In a statement sent to the press, Phoenix Commercial Property Development (PCPD) announced it sold its reversionary freehold of the site in May.

It was sold, the company said, to an American property investment company, who PCPD claim are going to sell the site immediately to an overseas developer.

PCPD said they understood the intention of the future freeholder was to come to an arrangement to terminate all the leases held on the property so the site could be made safe and redeveloped.

Newsquest (Image: Newsquest)

PCPD, which is funded by former Carlauren Group investors, said it had hoped to bring forward plans to redevelop the site but has now walked away from the property — and the Isle of Wight.

It has already sold the adjacent King's Bar.

The statement from PCPD explains the freehold it bought only becomes ownership on the expiry of the 125-year leases sold by the Carlauren Group (former owners of the hotel who entered administration) to private investors, which cover the whole site.

Wood piled up outside the Ocean Hotel. Picture by Isle of Wight Council. (Image: Isle of Wight Council)

There were 50 other leases which were sold for between £89,500 and £185,000, starting from November 17, 2017 to June 26, 2018, and all run for 125 years.

There are also two further leases on the site, PCPD say, which expire in 2025 and 2026.

It said: "PCPD completely understands the frustration of local residents but we were never in a position to intervene, it would have been a breach of the 125-year leases we inherited."

PCPD has in recent months faced legal action from both the Isle of Wight Council and Hampshire Constabulary — and slammed it as "nothing short of a witchhunt, motivated by local politics".

It says Stephen Purvis — who was due to appear before the Isle of Wight Magistrates' Court yesterday (Tuesday) but did not show — has taken legal action against the police and CPS.

It alleges the police did not serve a Community Protection Notice or warning to them and any claims otherwise are false. The police had previously said PCPD had acknowledged receipt of the notice.

The company has also appealed the council's recent win over its planning enforcement notice, to the Crown Court.

It said: "We hope the new owners will fare better than we have. We have made a significant loss on this site, which adds further to the suffering of former Carlauren investors."

TIMELINE OF THE OCEAN HOTEL

• Carlauren Group brought the hotel and in May 2017 announced plans to turn it into a luxury care home
• December 2019 - Carlauren Group placed into administration - Isle of Wight investors were among those fighting to recoup Carlauren Group losses
• April 2021 - The Ocean Hotel freehold was sold to PCPD
• May 2021 - A major fire saw further damage caused to the property

The Ocean Hotel on fire last May. Picture by Stephen Sheaf. (Image: Stephen Sheaf)

• January 28, 2022 - The Isle of Wight Council issued a Section 215 enforcement notice against PCPD.
• March 11, 2022 - The enforcement notice took effect but PCPD appealed the case to the Isle of Wight Magistrates' Court.
• May 12, 2022 - Hampshire Constabulary announced it had issued a Community Protection Notice Warning against the hotel's owners.

• May 20, 2022 - The first hearing of the Ocean Hotel appeal was heard in the magistrates' court where a hearing was set for August 3.
• May 31, 2022 - Stephen Purvis sold his shares and ceased to be a director of PCPD. PCPD sold its revisionary freehold of the Ocean Hotel.
• June 10, 2022 - No action had been taken against the police's warning notice so the police issued a formal Community Protection Notice (CPN).
• July 11, 2022 - No action had been taken against the CPN so the police issued a summons to court for the owners of the Ocean Hotel.
• July 15, 2022 - Magistrates requested the Isle of Wight Council's case be heard in court due to a lack of communication from PCPD. It was then decided to throw out the appeal, restarting the enforcement notice.
• September 13, 2022 - Stephen Purvis was due to be in court answering the breach of CPN but failed to show up. The case has been adjourned to October 4.
• September 14, 2022 - PCPD issued a press statement.