Sun International has announced that it is to close-down its Fish River Sun Resort near Port Alfred by the end of November, unless a compromise can be reached over land claims.
In a statement the hospitality group said that should the property close down, it would result in 126 job losses.
“The resort has over the past number of years recorded escalating costs and declining revenues in a depressed economic environment‚ with little prospect of financial recovery. The option to sell the resort has been complicated by an outstanding land claim‚ making this option unviable‚” said the statement read.
It is understood that dozens of farms and small holdings were being claimed as historical land by the Prudhoe and AmaZizi community. Sun International’s property is on some of the land which is in dispute.
Fish River Sun said it had explored all avenues to keep its doors open and satisfy the communities involved.
“[The hotel has] considered several cost-saving and revenue improvement alternatives which had either been implemented or rejected. However‚ these had not improved the financial position of the resort and the company therefore has no alternative but to close the business‚” the statement said.
The hotel giant said that economic pressure and subdued trading‚ taken together with the land claim uncertainty‚ had made cross-subsidisation by the Boardwalk in Port Elizabeth increasingly unaffordable.
The company would engage with the staff union about its closure