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No sale yet for Duluth-based ZMC hotels

The Inn on Lake Superior in Canal Park is among 28 hotels owned by Duluth-based ZMC Hotels that have been for sale since October. It’s an all-or-nothing offering. (Steve Kuchera / skuchera@duluthnews.com)1 / 2
The waterpark at the Edgewater on London Road in Duluth is a big draw for families. The Edgewater Resort and Waterpark is part of the ZMC portfolio of hotels for sale. (2012 file / News Tribune)2 / 2

When Duluth-based ZMC Hotels put its portfolio of 28 hotels up for sale last fall, a deal was expected to happen quickly or not at all.

Whether the all-or-nothing sale would happen probably would be known by Christmas, officials had said.

Six months later, there’s no sale. And company officials aren’t saying whether there’s one in the works.

“We’re still working on marketing and selling the property,” CEO Ken Goldfine said last week. “I’m not at liberty to say anything at this point.”

He also declined to discuss whether the company has received any acceptable offers, or offers to buy specific hotels. But selling all 28 hotels ZMC owns and manages in 10 states remains the company’s intent, he said.

A sale could result in the end of the company that was founded in the early 1970s by Duluth business legends Monnie and Erwin Goldfine. Monnie was Ken Goldfine’s father. Other results of a sale could include a merger with the new owners, ZMC continuing to manage the hotels or a company restructuring.

The properties for sale include the Inn on Lake Superior, Edgewater Resort and Waterpark, Days Inn Lakewalk and the Best Western Downtown Motel in Duluth. In Superior, it includes Best Western Bridgeview; and in Ashland, the AmericInn.

ZMC’s entire portfolio was listed for sale with a national broker in October. It’s an offer-driven listing with no asking price.

The move to sell came during a nationwide hotel shortage coupled with a growing economy. ZMC has a responsibility to its owners and investors to take advantage of that, Jon Driscoll, the company’s chief operating officer, explained then.

Last week, ZMC President Todd Torvinen confirmed there was no sale yet.

“We are still entertaining offers from prospective buyers,” he said.

But at some point ZMC will shut down the call for offers and go into a due diligence period, he said.

The hotels employ about 1,200 people, including 500 in the Twin Ports. Employees should not be affected by a sale because they will be needed to continue running the hotels, ZMC officials have said.

Since the properties were listed for sale, the company’s new Hampton Inn & Suites in Hibbing has opened. That hotel, and the Hampton Inn the company plans to build in Superior, were not included in the portfolio listed last year.