Arc Inspirations, a bar group in the north of England, has been forced to borrow an additional £1m as the UK enters another lockdown, according to the BBC.
Martin Wolstencroft, CEO at the chain that operates over 17 venues across the country, had already taken out £4m in loans to ensure the survival of the company that remains unable to trade.
Wolstencroft told the BBC that the money borrowed will only help the business “stand still”, with the debt being predicted to take six years to pay back.
He added: “We’ll be coming out of this in a far worse position with far greater debt and it totally reduces our ability to grow our business for the future. And all of this has been brought about through no fault of our own.”
Chancellor Rishi Sunak has announced grants worth up to £3,000 a month per property to keep businesses in the industry above water throughout the lockdown.
However, Wolstencroft described the support as a “mere drop in the ocean”, as Arc Inspiration often pays over £16,000 each month in rent for its bars.
This level of expenditure while unable to trade is contributing to the UK Hospitality’s estimates that the closure of pubs, restaurants, and hotels is costing business owners in the sector a total of £500m a month.