A PROMINENT seaside hotel in Alum Chine is to shut down next month, leaving its long-term future in the hands of town planners.

The Studland Dene Hotel and its popular restaurants will cease trading on October 7.

Four attempts to replace the hotel with flats have all been refused and leaseholder Peter Lyon claims the Victorian hotel is now "past its economic life".

But tourism boss Mark Smith remains convinced tourist accommodation could prosper on the site.

Two days after the hotel closes, a planning appeal will recommence to decide whether the site can be redeveloped with 14 residential apartments and a restaurant.

And a new "compromise" planning application has also been lodged with Bournemouth council, seeking permission to redevelop the site with holiday flats, residential apartments and a restaurant.

Mr Lyons, who has run the Studland Dene for six years, said the hotel's two restaurants were popular but insisted: "The burden of the hotel is more than they can bear."

He added: "I don't think anyone believes we lose money but we do. I work 18 hours a day, seven days a week and we're still not getting anywhere."

He said there was an extensive list of work that needed doing at the hotel and yet occupancy rates were around 30 or 35 per cent.

"You can't bang your head against a brick wall forever. We've been doing it for six years and we haven't even made a crack in the wall," he added.

But Mr Smith, head of tourism, queried whether the new planning application would be proposing to build holiday flats if the current hotel was unviable. "As far as the council is concerned our view is unchanged," he said. "That site is a fantastic one for tourist accommodation and I can't see that ever changing."