The province is close to finalizing a deal with a buyer for the Holman Grand Hotel, says P.E.I.'s premier.

Premier Robert Ghiz said the government is in final negotiations with a number of companies interested in buying the downtown Charlottetown hotel that closed its doors earlier this month after consistently losing money since its summer 2011 opening.

The province put up more than $16 million in loans for the Holman Grand, which is under creditor protection. The province holds the first mortgage through P.E.I.'s Century Fund.

Ghiz wouldn't say what companies government is in negotiations with, or what price.

Meanwhile, during question period Tuesday, Opposition leader Olive Crane demanded to know if taxpayers would be fully protected. She also referenced contractors who worked on the hotel and were owed more than $3 million.

The P.E.I. government put up more than $16 million in loans for the Holman Grand, and holds the first mortgage. (Ryan Hicks/CBC)

The Holman Grand Hotel was caught up in the financial restructuring of Homburg Invest Inc. when it was put under the Companies' Creditors Arrangement Act. The court appointed Deloitte and Touche as the monitor.

Part of a larger deal

On the floor of the legislature Crane said sources have told her who is about to take over the hotel.

"It appears that Kevin Murphy and Mike Arnold, both who are connected to the premier, have decided to buy this hotel. Apparently they've offered $8 million. Would the innovation minister confirm that this is who's purchasing the hotel?" said Crane.

Crane didn't say who provided those names and she didn't table any documents to back up her assertion.

When contacted by CBC News, Murphy said he's not involved in any plan to buy the hotel.

Ghiz sidestepped Crane's question about who is buying the hotel, but he did say he's confident an announcement on a new buyer will be made soon.

"We do not care what your political belief is. We care about making Prince Edward Island a better place for each and every Islander Madame Speaker. There are currently bids taking place Madame Speaker and we hope that we'll have an announcement in the very near future with regards to the future of those downtown properties."

Ghiz said he would like to see the sale of the Holman Grand Hotel become part of a larger deal that would involve loans on Confederation Court Mall and other large downtown properties.

"Well, that's what we'd like to see happen, but again, we're going to try to put together a deal that would be in the best interest of the taxpayers of this province."