An article “Hotel Lancaster lines up for CRIZ money” appearing in today’s Lancaster Intelligencer Journal / New Era but not yet posted at LancasterOnLine.com clarifies past misleading reports but provides new incredulous information:
“The ‘letter of interest’ the hotel developers will receive is not a firm commitment from the CRIZ board, but shows a willingness to include the project under the new program, possibly sending million s to the project…
“The Hotel Lancaster is one of eight projects being considered for the first phase of the program. Those initial projects are expected to spur more than $210 million in investment.
So now we learn that there will not be $15 million of CRIZ funds for the renovation of the Hotel Lancaster (formerly Brunswick) but rather funds to supplement its financing.
Also revealed is that there will not be funding for $210 million in investment throughout Lancaster City but rather funds to “spur” that amount of investment. We have no notion where the newspaper or the sponsors came up with the $210 million figure and excuse us if we find it incredulous.
We also are told “The [Lancaster Hotel] partners opened with 32 renovated rooms on the top, ninth floor. They are now using 100 guest rooms, [John Meeder] said.
“More than 900 room nights are already booked for March, allowing them to turn a profit for the first time, Meeder said. ‘It’s quite a transformation ,’ he said.”
“Transformation” hell; more like a miracle if 30% occupancy for the month of March assures profitability. At the $92 published rate, even if new reservations double for March occupancy, the owners are likely to choke on the cost of maintaining and operating that huge and aged facility.
The 300 room Marriott Hotel is about the size of the Hotel Lancaster. We cannot even imagine it earning money with revenue from just 60 rooms a night, even at double the room rate of the Hotel Lancaster. (Our sister companies own four hotels so we have some insight into the business.)
We do not call out reporters by name because in some cases they are but the tools of editors. The party writing the article has a long history of printing the company line.
On the other hand, we cannot fathom why the Lancaster Newspapers, Inc, half equitable owner of the Marriott, would desire a fully renovated competitor, probably with a strong national franchise such as Holiday Inn.
With Penn Square Partner’s partners foot dragging concerning the Martin Plan for bailing out Convention Center financing and ballyhooing the Hotel Lancaster, it is almost as though the partnership has a death wish. But it won’t be Penn Square Partners that take most of the lumps, but rather the City of Lancaster which owns the Marriott and would have to take it over if Penn Square Partner cancels its lease.
Of course Penn Square Partners could rush to the rescue and operate a casino in the vacated convention center space. (Their contracts appear to give them the right for any future use.) Some have long speculated that this has been the intention from the outset.
