Hotel for sale

Macdonald Arms Hotel, Main Street, Tobermory, Isle Of Mull PA75

The MacDonald Arms Hotel in Tobermory presents a rare opportunity to acquire a fully refurbished, turnkey island hotel in one of Scotland’s most picturesque and high profile Hebridean locations. Combining a beautifully reimagined period property with an established hospitality business, a characterful bar and its own waterfront restaurant, 75 West, it is ideally placed to capitalise on the enduring appeal of the Isle of Mull to domestic and international visitors alike.

Location and lifestyle

The hotel occupies a prominent position on Main Street in Tobermory, the island’s colourful waterfront capital famed for its painted harbourfront buildings, sheltered bay and vibrant maritime atmosphere. Life here offers an attractive balance of community, scenery and connectivity, with regular Caledonian MacBrayne ferry services from nearby Craignure to Oban providing straightforward links to the mainland rail and road network.

Tobermory functions as the main service centre for the island, with a good range of independent shops, cafés, restaurants, a small supermarket, medical and dental provision, and a choice of primary and secondary schooling serving local families and those relocating to Mull. Wider island amenities include additional services in villages such as Salen, outdoor pursuits from wildlife watching and sailing to hillwalking and beaches, all underpinning Mull’s reputation as an outstanding place both to live and to visit.

For operators and staff, Mull’s resident population is complemented by a very substantial seasonal influx, ensuring a lively atmosphere in peak season while retaining a strong sense of community year round. Despite its island setting, Tobermory remains accessible for commuting to the mainland as required, with Oban, and onward connections to Glasgow and beyond, reachable within a reasonably straightforward journey via ferry and road.

The property

The MacDonald Arms has been completely gutted and refurbished throughout, with no expense spared, and is now presented in immaculate condition, ready for immediate continuation of trade under new ownership. Behind its traditional façade, the interior has been re imagined to create a contemporary, design led boutique feel while still acknowledging the building’s character and coastal setting.

A welcoming reception is positioned within the main hall, from which both the bar and the hotel’s signature restaurant, 75 West, are directly accessed, creating an intuitive and efficient flow for guests and staff alike. The ground floor bar offers around 25 covers in a relaxed, sociable setting and operates as a vibrant hub where locals and visitors come together to enjoy classic pints, a carefully curated whisky selection and expertly crafted cocktails. Adjoining this space, 75 West provides a contemporary waterfront dining room with approximately 40 covers, configured to maximise flexibility for residents’ dining, non resident bookings and small private events. Large windows in both bar and restaurant frame stunning views across Tobermory Bay, reinforcing the hotel’s connection to the harbour and significantly enhancing the overall guest experience.

To the rear lies a newly installed, generously proportioned commercial kitchen, comprehensively equipped to a high standard with ample preparation, storage and service areas, ideally suited to a quality driven, ingredient led food operation. A grand staircase rises from the hall to the upper floors, reinforcing the sense of arrival and connecting neatly with the guest accommodation above.

On the first floor there are six beautifully appointed letting bedrooms, all with contemporary en suite facilities. Two luxurious king size rooms enjoy elevated views over the sea, capitalising on the hotel’s position above the harbour, while the remaining four rooms are individually furnished and decorated to a truly stunning standard, each with its own character and design touches. At the rear of the first floor is a self contained staff accommodation area comprising three bedrooms, offering significant on site housing for key team members, a valuable asset in an island setting.

The second floor provides a further five en suite letting bedrooms, three taking full advantage of the sea views to the front and two set to the rear, again presented in excellent decorative order and continuing the hotel’s high quality design language. In total the property offers 11 stylish en suite letting rooms, extensive public areas and strong back of house provision within a comprehensively upgraded shell, minimising foreseeable capital expenditure for a purchaser.

The business and trading potential

The MacDonald Arms operates as a small hotel with 11 en suite letting rooms, the lively public bar and 75 West, a relaxed, contemporary dining experience set directly on Tobermory’s iconic waterfront. The bar trades as a traditional Scottish pub with modern touches, known historically as one of the best value places to eat and drink in Tobermory and still very much a favourite for a convivial dram with the locals.

75 West focuses on approachable but high quality cooking that makes strong use of local seafood and island produce, positioning the hotel firmly within Mull’s growing reputation for good food and relaxed, experience led dining. At present, the restaurant primarily serves evening meals for residents and non residents, and there remains clear potential to extend trading through the introduction of regular lunches and enhanced promotion to the wider visitor market.

Room rates on the Isle of Mull for quality three and four star accommodation typically range from around £110 to over £300 per night depending on season, with recent market data indicating average nightly rates well in excess of £200 in peak summer months. Against a backdrop of strong demand and limited high quality bed stock in Tobermory, a fully refurbished, sea view, boutique style property such as the MacDonald Arms is well positioned to command premium tariffs within the local market, subject to the operator’s chosen positioning and revenue management strategy.

Tourism remains a cornerstone of Mull’s economy, with visitor spend driven by its wildlife, landscapes and coastal scenery, as well as its increasingly recognised food and drink offer. With its immaculate refurbishment, prime Tobermory seafront location, characterful bar and destination restaurant, the MacDonald Arms represents a compelling opportunity to acquire a turnkey Hebridean hotel business with multiple levers for future growth.

Staff

The business is operated by a highly efficient and lean team, ensuring smooth day-to-day operations while maintaining strong cost control. Management is overseen by a full-time seasonal General Manager, supported by a capable back-of-house team including a Head Chef, Second/Breakfast Chef, and a part-time Kitchen Assistant. Front-of-house service is delivered by a team of two full-time and three part-time bar and restaurant staff, providing flexible coverage during peak periods. Housekeeping requirements are managed by a part-time seasonal team member, completing a well-balanced and streamlined staffing model ideally suited to the scale of the operation.

Room Rates

Room rates are positioned to reflect the quality of the offering, with standard double rooms achieving rates from £210 per night, rising to £420 per night for premium king rooms with sea views. The business benefits from a dynamic pricing strategy designed to maximise revenue in line with demand, with peak rates in excess of £600 per night already achieved this season and further upside anticipated as the high season progresses.

Rateable Value

The subjects are entered in the current Valuation Roll with a Rateable Value of £24,000, effective from 1st April 2026.