A hotel has announced the cancellation of bookings at short notice amid talk that it is being taken over by the Home Office to house asylum seekers.

The Argus understands that the hotel in Chichester is set to close next week and has been signed over to a third party for 18 months.

A member of staff at the hotel said that nearly a thousand bookings and Christmas parties had been cancelled in the coming months to accommodate the proposal.

The member of staff, who did not wish to be named, said: “The hotel is set to close from Monday. We have had to cancel around 900 bookings and Christmas parties.

“From then it will be handed over to the Home Office.”

A spokesman for the hotel, which The Argus is choosing not to name, confirmed that the hotel was being signed over to a third party but would not confirm that the hotel was being taken over by the Home Office.

He added that the third party “has plans for alternative arrangements in terms of the type of guests who will be staying there” and that there was “public sector involvement”.

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He added that the hotel had been able to partner with another local hotel to honour many of the outstanding bookings.

Documents seen by The Argus show that all the rooms in the hotel have been booked by Fairer Places Ltd for a period of 18 months.

Listings on Companies House show that the principal activity of the company was to “provide accommodation and business support service activities”.

The use of hotels to house asylum seekers has come under fire after scores of young children went missing from similar hotels in Brighton earlier this year.

Plans have since been considered to temporarily house asylum seekers on a barge in Dorset and on the site of Northeye prison in Bexhill.

A spokesman for the Home Office refused to confirm or deny that the Chichester hotel was being used to house asylum seekers.

The Home Office added: “The number of people arriving in the UK who require accommodation has reached record levels and has put our asylum system under incredible strain. “We have been clear that the use of hotels to house asylum seekers is unacceptable – there are currently more than 51,000 asylum seekers in hotels costing the UK taxpayer £6 million a day.

“The Home Office is committed to making every effort to reduce hotel use and limit the burden on the taxpayer.”