The former Castle Mona hotel has been sold at auction.

It has been sold to an undisclosed island-based developer for a sum that ’substantially’ exceeded the £1m reserve price said Simon Riggall of London-based auctioneers Lambert Smith Hampton.

The identity of the new owner has yet to be revealed.

Sefton Group boss Brett Martin said: ’We’ve exchanged contracts and are hoping to complete in the next few weeks.

’The party has had consistent interest in the site since before the summer.’

Mr Riggall said as the auction got underway on Monday, the Castle Mona was withdrawn as a lot when a six-figure deposit was paid electronically.

He said: ’There had been a considerable level of interest and there were four telephone bidders.

’During the auction we had an email saying a deposit had gone in and the lot was withdrawn. It was from a party that had shown interest previously. It’s a local developer but I have no idea what their plans are.

’The Castle Mona is perhaps the most prominent building on the seafront. There is a great appetite to see it developed and brought into use.

The Castle Mona was put back up for auction following delays to progress an earlier offer on the building.

The historic landmark had been due to go under the hammer in July but was taken out of the auction catalogue after an offer in excess of the guide price was received.

It has been described as a ’development opportunity’ by the auctioneers.

The site includes the 98-bed hotel with historic double height ballroom and dining/function rooms, together with a bowling alley and two nightclubs.

Built as the residence of the 4th Duke of Atholl in 1804, the hotel was closed suddenly by its previous owners in December 2006. It was acquired by the Sefton Group two months later. Plans to turn it into a four-star hotel came to nothing and it was mothballed. It was put on the market in 2011.