More than 100 firefighters tackled a blaze at the Falmouth Beach hotel in Cornwall on Monday.
The fire was reported at the 120-bedroom Best Western property at Gyllyngvase beach seafront at 12.09pm on 30 April.
Strong winds hindered the efforts of firefighters to bring the blaze under control. The fire spread through the building and caused the roof to collapse.
Eyewitness Sean White, director at neighbouring business Wesup Paddleboarding, told Caterer and Hotelkeeper how the fire quickly got out of control.
"It started with a little bit of smoke from what looked like a tiny fire," he said. "Then within half an hour there were flames coming out of the roof and the roof fell in."
Hotel staff and around 30 guests, including Blur guitarist Graham Coxon, were evacuated from the property as well as 100 guests from neighbouring hotel the St Michael's. Initially 12 guests could not be located. Nine later made contact and police said the final three, some businessmen, were now accounted for.
Nigel Carpenter, owner of the St Michael's, told the BBC that the loss of his neighbouring hotel was a "knock for Falmouth", adding: "It is 120 rooms out of the town for the foreseeable future."
Firefighters took more than seven hours to bring the fire under control but crews remained at the hotel on Monday night in order to damp down hot spots.
Ben Young, manager of the nearby Falmouth hotel, which provided accommodation for some of those left without room, said that some holidaymakers had been left with "literally no possessions" as a result of the fire.
"Those that had been out all day came back to find that all their possessions had gone," he said.
"There were also those who were due to check in who had nowhere to check into."
The family-run Falmouth Beach hotel, which opened in 1984, became part of the Best Western group of hotels in 2000. A Best Western spokesperson said hotel accommodation had been found within Falmouth for people who were due to stay at the Falmouth Beach this week, while the hotel's event co-ordinator had also begun to contact couples who were due to celebrate their weddings at the property.
Falmouth mayor Geoffrey Evans said the fire was a disaster for the town and "couldn't have happened at a worse time". Next month the town is due to host the Finn Cup sailing competition and is one of the towns to welcome the Olympic Torch on the first day of its relay throughout the UK.
The investigation into the cause of the fire is being carried out by police and the fire service. It was not believed to be suspicious, investigators said, but may have been started by a tar heater.
By Janie Manzoori-Stamford
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