A FOUR-STAR hotel and conference centre on Portland has closed with immediate effect due to the ‘current financial situation’ hitting its trade.

Twenty-one employees have been made redundant from the 78-room, four-star Portland Spa Hotel and Conference Centre.

The latest blow follows 11 redundancies in May this year, when it was announced that Portland Spa Limited had gone into administration.

A spokesman for KPMG, the appointed administrator of the hotel and Southwell Estates Ltd, said they had been unable to attract any buyers for the hotel and now the business ceased to exist.

Hotel staff were called into a meeting yesterday and told that the company could not continue to trade.

One member of staff, who did not wish to be named, said bosses blamed the ‘current financial situation’.

The hotel’s leisure facilities comprising a fitness club, spa therapy suite and swimming pool remain open.

Joint administrator Richard Hill from KPMG said: “Despite everyone’s best efforts to stabilise the business, the company has continued to make losses which cannot be sustained and we have been unable to attract any buyers for the hotel. We have no option but to close the hotel which has resulted in a further 21 employees being made redundant.”

Islanders have spoken of their ‘dismay’ at the closure.

Portland mayor Richard Paisley said: “When these things shut down it puts local people out of work and all the businesses in the building will be affected.

“It’s no good for the Island and certainly no good for the staff.

“My thoughts are with the people who have lost their jobs, it’s always sad to see companies go.”

He added: “We’re trying to encourage regeneration on Portland but it keeps getting knocked back.

“With the recession, it’s a difficult time for a lot of companies. There were a lot of mixed feelings about the hotel being so far out of the way.

“If there had been a better economy perhaps they would have had a better chance to get it off the ground but the rug was pulled from under them really.”

John Nash, owner of Portland Stone Limited, said: “A lot of local people have lost money to Portland Spa and it’s them I feel sorry for.

“I haven’t got a lot of time for them after how they’ve treated local people.”

Portland resident Nigel McColm said: “It’s a shame really.

“If they could’ve lasted out a bit longer it might’ve been better with the Olympics. It’s a bit of a disappointment for all the hard work that’s gone into it.”