Long-running plans to create a flagship five-star hotel in Dundee City Centre lie in tatters after operators decided against developing the property, the Tele can exclusively reveal.
Apex Hotels originally announced plans to renovate the Custom House building on East Dock Street into a boutique hotel back in 2017.
At the same time, the group announced it would renovate its existing property, Apex Hotel City Quay and Spa, which sits adjacent to Custom House.
But Apex has now confirmed that planned work will not go ahead after they pulled the plug and decided to sell the Custom House.
A spokesman for the hotel chain said: “Having carried out a full market assessment that looked into the future plans of Custom House and considered various options, we have taken the decision to sell the property.
“With the number of hotels increasing within the area and having already invested heavily in our Dundee property with a £2.4 million upgrade, now is not the time to develop Custom House and bring more accommodation to the market.
“We will continue to invest significantly in Apex City Quay Hotel & Spa, with a £1 million programme of works to refurbish our front of house getting under way in the coming weeks.”
Previous management at the hotel raised concerns that the Foxlake aqua park directly outside of Athe Apex could have a detrimental impact on bookings.
The aqua park has gone from strength to strength and offers wakeboarding and paddle- boarding as well as sessions on its inflatable assault course.
Since plans to construct the V&A were announced in 2010, there has been a significant surge in the number of hotels built across the city.
Hampton by Hilton, Hotel Indigo, an expanded Premier Inn and Sleeperz above the rail station have all opened within a 10-minute walk of the museum.
But city development convener, Alan Ross, has insisted he is not concerned by the amount of accommodation for visitors in the city centre and said: “This decision has been made solely by the Apex for its own reasons.
“I’m not worried about the number of hotels operating in Dundee.
“We identified the number of beds required by the city some time ago. I’ve spoken to management at the Sleeperz hotel above the railway station who said they would welcome another hotel in Dundee.”
The area around Custom House has been a hot spot for property developers in recent years.
Construction firm’s McGill and Cater Homes plan to redevelop the former DWP building on the corner of Gellatly Street and East Dock Street to create 38 new homes.
Meanwhile, a former warehouse at the bottom of Trades Lane could be demolished to make way for 28 properties, including three penthouse flats and three retail units on the ground floor. The adjacent Maritime House, which was once the home of travel firm DP&L, is being converted into 10 new flats.
No concrete plans for Custom House will be on the table until a new buyer for the property is found.
However, the building could appeal to a property developer looking to create more homes in the area, rather than a rival hotelier.