The Elms Hotel could be demolished and replaced with 50 apartments, a warden's flat and two nurses' studios if planning permission is
granted – and if not, it will probably close anyway within the next four months.

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Jonathan Barker of owners Mitchell's Brewery said the Elms – which had been up for sale for almost two-and-a-half years – had not been "paying its way".

Jonathan also said the upcoming opening of the Midland Hotel was a factor behind the decision to close.

"There has been very, very little interest, and none whatsoever within the past 12 months, from buyers wanting to run it as a hotel," he said.

"The opening of the Midland may be putting people off, because that will be of a very high standard.

"The market has changed in favour of budget hotels and hoteliers with greater facilities are reducing their prices to boost their occupancy.

"The Elms has a lot of high ongoing running costs and it doesn't really stack up financially to keep it open."

The planning application, submitted earlier this week, is a joint venture with Morecambe entrepreneur Martin Higginson's Hay Carr Estates.
Lancaster City Council will meet to discuss the plans within the next 13 weeks.

"If the application is turned down, there is a strong possibility the hotel will close anyway," said Jonathan.

The Mitchell's-owned Owls Nest pub in the grounds of the Elms will remain open.

Coun June Ashworth, ward councillor for Bare and cabinet member for tourism, said a lot of people would be "devastated" by the almost certain demise of the Elms which is over 100 years-old.

"I'm extremely disappointed and it's a shame they have chosen this particular time when the economic benefits of the town's regeneration are there for everybody," she said.

"The Elms provides a need not only for visitors to the area but also for locals, with its various functions and luncheon clubs.

"The Midland is going to be the catalyst for drawing people into the resort and there will still be a need for other hotels as well.

"If The Elms Hotel was to go it would be a devastating blow for tourism, just as optimism in the resort is at its highest for years."

The Elms, which was bought by Mitchell's in 1985, is not the first major Morecambe hotel to announce closure plans recently.

Last September Stephen Norfolk, manager of the Broadway, announced plans to redevelop the seafront hotel into a strikingly modern apartment block containing 50 flats.

Planning permission was granted and work could begin within the next 18 months.

Stephen, who also owns the Headway Hotel on the promenade, said at the time that no potential buyers were interested in keeping the Broadway as a hotel because it was in a "consistent and arguably irreversible downturn".

* THE Mitchell's-owned Water Witch pub in Lancaster will re-open next month following a refurbishment.