Two directors of Stay Belvedere Hotels Limited (SBHL), Safwan Adam and Bassam Gilini, have earned substantial sums from contracts to run asylum seeker accommodation in the UK, with the company drawing nearly £705 million in income during a recent 12-month period. This amount, primarily sourced from Government contracts, included more than £45 million paid out as dividends to shareholders.

Stay Belvedere Hotels, responsible for managing 51 hotels used to house asylum seekers—including the Ibis Budget in Bishop’s Stortford—has recently had its Home Office contract terminated amid concerns about its performance. The Home Office cited “concerns about its performance and behaviour as a government supplier,” leading to the firm being dropped from the supply chain last month. The contract for managing these hotels is now being transferred to other providers, including Mears, Serco, and Corporate Travel Management.

Company filings reveal that Adam and Gilini each hold a 17.5 per cent stake in SBHL through holding companies, entitling them to dividends exceeding £7.8 million each. Between February 2020 and December 2022, the company reported pre-tax profits of approximately £75.7 million from a turnover of £888.2 million. During this period, a £2.5 million bonus was also distributed, worth around £430,000 per director.

Despite these financial gains, the company has faced criticism for its treatment of hotel workers. Reports highlighted instances of staff, many of whom were foreign nationals, being paid below the minimum wage—down to £5.60 per hour when the legal rate was £8.70. An SBHL spokesperson stated that the firm would examine any ‘issues or errors’ to ensure they were swiftly rectified.

Both directors appear to have limited experience specifically in immigration accommodation prior to their appointment in April 2021. Safwan Adam holds a degree in aeronautical engineering and runs various business ventures including an investment firm, a franchise of second-hand electronics stores, and homecare providers. He has also been involved briefly with a German Doner Kebab franchise and worked for Madame Tussauds. Bassam Gilini describes himself as a “visionary” property developer and has previously run pop-up fireworks shops and a sushi restaurant in east London.

Adam is also a significant political donor, having given over £760,000 to the Liberal Democrats last year, including nearly £500,000 through his investment firm ahead of the general election, according to MailOnline.

SBHL was subcontracted by Clearsprings, a larger accommodation firm contracted by the Home Office since 2019 in a deal worth about £2 billion annually. Clearsprings itself has faced scrutiny over the quality of its asylum seeker accommodation. It was reported that former Conservative MP Crispin Blunt served on Clearsprings’ oversight board, with modest remuneration for limited hours of work.

In light of the contract termination, some hotel owners have expressed frustration over delayed payments for their facilities. One hotelier told the Daily Telegraph that, without proper payment, eviction of asylum seekers might be considered. SBHL responded by assuring that payments for April had been made upfront while contracts are rearranged.

The company’s website does not list Adam or Gilini, instead employing stock photos and promoting SBHL as a ‘leading provider of temporary accommodation for those seeking asylum in the UK’. When asked about the absence of management information online, a spokesperson cited safety concerns due to past threats.

Asylum minister Angela Eagle stated that increased oversight of asylum accommodation firms led to the decision to remove SBHL from the supply chain. She added: “We have made the decision to remove Stay Belvedere Hotels from the Home Office supply chain and will not hesitate to take further action to ensure Home Office contracts deliver for the UK.”

Meanwhile, refugee charities have voiced criticism of the profits accrued by companies managing asylum accommodation. Tim Naor Hilton, chief executive of Refugee Action, remarked, “Every pound that fills the pockets of these companies is a pound that could be spent in our communities,” highlighting concerns about the allocation of public funds.

SBHL’s operational model reportedly included a range of services for residents, such as daily meals, English lessons, and recreational activities. An insider described the accommodation as akin to a ‘four-star all-inclusive’ experience, with fresh meals three times a day, continuous access to fresh fruit, and various social programmes. However, the Home Office maintains a policy of not commenting on individual hotel arrangements, noting that many activities are arranged by external agencies including charities.

The wider context involves substantial Government expenditure on asylum accommodation. The Home Office reportedly spends approximately £5.5 million daily to house around 38,000 asylum seekers across over 200 hotels in the UK. Despite commitments under the current government to phase out the use of hotels for asylum housing, numbers have increased, with more than 9,600 people arriving in the UK by small boat so far this year, a record high. At least 11 people have died attempting the crossing since January.

A recent report by the Office for Value for Money, under the leadership of Labour leader Sir Keir Starmer, criticised firms such as Clearsprings, Serco, Mears, and SBHL for making “record profits” amid growing costs, which reportedly rose from £17,000 to £41,000 per asylum seeker between 2020 and 2024. The Home Office has acknowledged the substantial scale and cost pressures of the asylum system but emphasised efforts to improve decision-making processes and reduce reliance on hotel accommodation going forward.

The Daily Mail is reporting on this development and its implications for the management of asylum accommodation and public expenditure in the UK.

Source: Noah Wire Services