The Palace hotel in Southport was requisitioned for an American Red Cross Service Club from 1942-to 1944. The Southport Hotel Company developed the Palace with the assistance of Manchester Merchants. The Palace Hotel was built on a 20-acre (8.1 ha) site at the end of Weld Road, fronting the Birkdale shore. The 200 ft (61 m) long luxurious hotel opened in 1866 at a cost of £60,000 with a grandiose design and magnificent reception rooms and 75 bedrooms.
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The Palace Hotel in Birkdale, Southport was used as American Red Cross Service Club from September 1942 until September 1944. The Palace soon became a favourite with the G.Is and made Southport very popular with the U.S Army. In September 1944 the American Air Force moved into the hotel, and the Palace became A.A.F Station 542. The hotel became one of 16 rest homes for combat airmen from the 8th and 9th Air Force, and the only place in Europe to take entire bomber crews as one unit. On average 350 -400 airmen visited the Palace rest home each week. The American Red Cross Service Club moved to Sunnyside Mansions Hotel, which was situated on the corner of Knowsley Road and Saunders Street, Southport. Many Anglo- US marriages started at The Palace and Sunnyside Mansions, and Mrs Agnes Broughton Director of the ARC paid tribute to the British girls who volunteered in the Canteen and supported recreational activities and dances. The Palace Hotel was demolished in 1969, and Sunnyside Mansions was demolished to make way for a modern apartment building.