The New IRA terrorist group allegedly tried to bomb a Derry hotel because it hosted a police recruitment fair a week ago, it has emerged.

Dissident republicans attacked the Everglades hotel on Thursday night because it was planning to host another jobs fair organised by the Police Service of Northern Ireland next week, security and republican sources have confirmed.

The latest attack in Derry city took place just hours after the PSNI appointed the former Royal Ulster Constabulary officer George Hamilton as its next chief constable. The New IRA and other groups opposed to the peace process have attempted to dissuade Catholic recruits from joining the PSNI because they argue it is still a British police force. They have killed two PSNI officers, including Catholic constable Ronan Kerr three years ago in Omagh, County Tyrone.

Customers and staff at the hotel had a narrow escape after a masked man threw a holdall containing an explosive device into the reception area. It later exploded as army technical officers were trying to deal with it. No one was injured in the blast, but the bomb caused severe fire damage to the front of the hotel.

A police spokesperson said the quick action of hotel staff and police officers in evacuating people from the premises had "undoubtedly helped to prevent a tragedy".

Guests staying at the Everglades were later transported to other hotels across the city. Among those who had to be evacuated were members of a family who had attended a burial earlier in the day.

The police spokesperson said the bomber escaped in a red Volkswagen Golf, with the registration number YIB 8658, which was driven by another man. The car was later found burnt out in the Glendara estate area of the city.

Denouncing those behind the bomb, Mark Durkan, the MP for Foyle, said: "So many people are working hard to move the city forward, but those behind this device are trying to drag us all back to worse times. Such methods demonstrate only a negative, violent capacity, not a viable strategy or credible rationale.

"The nature of the device, and the manner of this reckless attack, show that they are a threat to anyone and everyone. That is why we must be united and strong in rejecting their ways, and affirming peace and progress as our chosen determined collective right."

The attack underlined the challenges Hamilton faces in trying to counter the ongoing dissident republican terror campaign aimed at destabilising the power-sharing settlement in Northern Ireland. Derry is one of the few strongholds of dissident republican groups in the country, namely the New IRA.

Last week a supporter of the New IRA's armed campaign, ex-republican prisoner Gary Donnelly, topped the poll in local elections in the ward of the city which is home to Martin McGuinness, Sinn Féin's deputy first minister of Northern Ireland.

McGuinness condemned those responsible for the attack, saying: "Derry is a place looking to the future and will not be held back by those living in the past."

The north-west city has been the focal point of repeated bombings and shootings by the New IRA over the last year.

In his first public statement since being selected chief constable, Hamilton said the explosion indicated some of the challenges that face the entire community.

"These are people who are opposed to peace, they are people who are trying to use violence, who are damaging the economic wellbeing of the country, who are taking jobs off people and they don't actually care about this place or about the citizens of it – I do, deeply," he said.

"We will be doing everything in our power possible to prevent occurrences like that and when they do occur we will be doing everything possible to bring those responsible to justice."