Radisson Hotel in Duluth for salePutting the hotel up for sale has nothing to do with the March 13 waterline break that flooded the building’s lower level, knocking out power and forcing guests to relocate, owners say.
By: Peter Passi, Duluth News Tribune
Duluth’s Radisson Hotel is for sale — but it has nothing to do with the March 13 waterline break that flooded the building’s lower level, knocking out power and forcing guests to relocate.
Although it wasn’t announced to the public, a Chicago-based brokerage firm first listed the property in January, months before the Radisson closed for repairs. The asking price for the 288-room hotel was $9.5 million, according to local industry insiders.
Bill DeSanto, chief operating officer for ZMC Hotels, said he toured the Radisson, but the Duluth-based chain decided against making an offer. He said ZMC already controls a local inventory of about 800 hotel rooms in the Duluth market, and said it just did not make sense to add significantly to that portfolio.
Mark Emmel, president and chief operating officer of Lion Hotel Group, also said the Radisson property wasn’t a good fit with the 345 hotel rooms his firm already manages in downtown Duluth.
“It wasn’t in our strike zone,” he said.
But the listing sparked plenty of interest, said Jeff Briner, general manager of the Radisson Duluth Harborview.
“I’ve probably toured just about every hotel operator around through here, from the front to the back of the house,” he said.
Briner said he does not know how much the current owners are seeking for the hotel or how serious they are about wanting to sell the property. He said sometimes large ownership groups will list a property simply to discover what it is worth in the current real estate market.
The Radisson Duluth Harborview is controlled by Trinity Hotel Investors LLC of New York City. Randy Efron, Trinity’s vice president, did not return calls Monday afternoon from the News Tribune.
Two agents for Paramount Lodging Advisors, the hotel broker that’s listing the property, also declined to return phone calls Monday. An online listing by the hotel broker indicated the property was available for sale under the Radisson flag, could be renovated and rebranded as a Doubletree, or could operate under an entirely different name.
Paramount provides list prices and other details about the properties it handles only to qualified buyers and only after they’ve signed off on a confidentiality agreement.
The Radisson was built in 1969 and features the revolving JJ Astor Restaurant on its 16th floor.
The Duluth city assessor’s office lists the hotel and its adjoining parking structures as having an estimated market value of more than $4.1 million.
The property last sold for slightly in excess of $5.8 million in January 2007, according to records filed with the St. Louis County auditor’s office.
DeSanto said he suspects the price has tumbled appreciably since the accident forced the Radisson to suspend its operations.
But Briner said repairs continue and should actually boost the value of the property, despite temporarily disrupting business.
“We’re replacing some of the original mechanical systems from 1969, and because of all that work, it will only add to the value of the hotel,” he said.
In the meantime, DeSanto said the local hospitality industry has rallied to assist the Radisson and its displaced guests. The hotel is scheduled to reopen May 15.
“We’re all helping them as best we can,” he said.
Emmel described a similar response, saying: “We have a lot of empathy for them. We’re fierce competitors in this market, but we’re also friendly competitors. I wouldn’t wish something like that on anyone.”
Besides helping guests, Emmel said some local hoteliers also have tried to provide work for Radisson staff who are temporarily without employment while repairs continue.
“We’re all hoping they’ll be back online soon, especially because we’re heading into the busy tourist season with all the special events, like Grandma’s Marathon,” he said.
The last thing anyone in the local hospitality industry wants to see is would-be visitors turned away from a stay in Duluth, Emmel said.