Vancouver's Donnelly Group of bars and restaurants files for creditor protection

Prominent Vancouver pub and restaurant manage‐ ment company Donnelly Group has announced it is seeking creditor protec‐ tion.

In a news release, the com‐ pany calls the move to initiate proceedings under the Com‐ panies Creditors Arrangement Act (CCAA) "strategic," citing the impacts of the global pan‐ demic as the reason.

The company owns 11 es‐ tablishments in Vancouver, including the Lamplighter Pub in Gastown and Bomber

Brewing craft brewery. It also owns three pubs in Toronto and three barbershops under the Barber & Co brand.

"Despite the often startling perception of this filing, it's very much a constructive ver‐ sus destructive financial tool that will first bring added sta‐ bility and then growth to our businesses operating in the embattled hospitality indus‐ try," said CEO Jeff Donnelly.

Jeff Guignard, executive di‐ rector of the Alliance of Bever‐ age Licensees of B.C., said the sector, in general, is struggling with inflation, a labour short‐ age, and having to pay back loans taken out during the pandemic.

"From an industry per‐ spective, about half of the overall hospitality industry is either losing money or barely breaking even right now," said Guignard. "When you hear of any particular place applying for creditor protec‐ tion or going into bankruptcy proceedings, it's just a sad comment on how difficult it is to run a hospitality business right now."

Donnelly Group used to have a much bigger footprint in Vancouver but has divest‐ ed itself of a number of loca‐ tions in the past years.

The company gained pro‐ file in 2017 when it took over the former site of the Railway Club, a beloved live music venue on Dunsmuir Street.

In the news release, Don‐ nelly Group said it will contin‐ ue to operate all locations while maintaining employees and supplier relationships during the CCAA process.

"Recognizing the need to navigate these difficult times and safeguard the well-being of its employees, the compa‐ ny aims to continue working cooperatively with its lender to revise the terms of existing loans, restructure the debt that was required to survive the pandemic and emerge as a more robust organization," said the news release.