Today we report that Cornerstone Hotels, which operates signature hotels including Melbourne’s Botanical Hotel and the Half Moon, has gone into receivership.
It’s bad news, especially when punters are unsure about what is going to happen to their favorite watering hole. But in retrospect, this month has had few of the high profile company collapses when compared to February.
The calm won’t last. Insolvency experts and bankers tell me they are gearing up for the next wave of collapses to hit in May. Businesses should by now have a pretty good view of how they travelled in the March quarter. They generally report to banks in the next 45 to 60 days.
Once it is clear that these companies are breaching covenants the banks move very quickly. The insolvency experts are also counting on more retail companies collapsing, believing that the stimulus package propped things up in December but the March quarter has been brutal.
As one banker told me: “If you have concerns about the March quarter, pick up the phone now. Don’t wait.”