Belvedere's sale ended free ride for Victor Frenkil

ROGER SIMON

October 12, 1990|By ROGER SIMON

It was about two years ago that Victor "A Legend In His Own Mind" Frenkil first heard the terrible word. It was a word he was not used to, a word that no previous mayor of Baltimore had ever spoken to him.

The word was "no."

No, Mayor Schmoke said, he would not pour more money down the bottomless pit that was the Belvedere Hotel. There would be no more city loans.

The renovation of the Belvedere Hotel was not a bad idea. Nor was the location that terrible.

It was simply that Victor Frenkil was lousy at running the Belvedere Hotel. And in the end it turned out to be a costly irony that Frenkil had lifted the Belvedere out of the ashes only to run it into the ground.

And it was the people of Baltimore who paid for it. They paid millions and millions for it. Time after time, Frenkil went to the city for money, knowing the city was a much softer touch than the banks.

On occasion, banks demand some proof that you know what the hell you are doing before they lend you money. The city never demanded such proof from Victor Frenkil.

Instead, the city opened up its coffers and emptied the contents into Frenkil's pockets. And in so doing, the city declared the Belvedere a Failure Free Zone.

If you were a small businessman and you ran a lousy business and customers started staying away, you might stop and rethink what you were doing .

But Frenkil didn't have to stop and re-think. As long as the city kept lending him money, he didn't have to worry about failure. He didn't have to worry about learning how to run a hotel.

Long after it became clear that the Belvedere would never turn a profit under Frenkil, the City Council tried to summon up the courage to halt the flow of greenbacks to him.

But it failed. Frenkil's argument seemed like such a powerful one: You have no choice, he said. Either you give me more money to protect the money you have already invested, or you will lose everything.

And so by 1988, Frenkil owed the city nearly $6 million in principal and interest on his loans.

Each time he was criticized, his supporters would dutifully write letters saying how heroic and self-sacrificing he was. But I failed to see it. It was Frenkil's former company that was hired to do the original renovation of the Belvedere and a company he headed received $434,732 in just two years for managing the Belvedere.

Today, Frenkil claims he invested $12.5 million of his own money in the Belvedere and "never got a nickel out of it."

Even if that is true, however, it just serves as testimony to what an appalling businessman he was when it came to that hotel.

Frenkil's last bid for city money was a beaut. He sent a front man to tell the city that if it gave Frenkil just another crummy $3 million, Frenkil would withdraw from the "daily operation" of the Belvedere.

In other words, the city could get rid of Frenkil, but only at a huge price.

In addition, the front man promised that if the city ponied up the money, "we will have the loans paid by 2012."

Fortunately, Mayor Schmoke was neither eager to buy the Brooklyn Bridge nor believe the claims of Victor Frenkil.

Schmoke turned off the spigot. A mayor who was closing down firehouses could hardly afford to play Santa Claus to Frenkil.

So, inevitably, the hotel went belly up, as it should have been allowed to do long before the city squandered all those millions on it. It was sold last week in bankruptcy court for $5.5 million.

The city, however, will get only $1 million in cash, thought it retains ownership of the restaurants, bars and food service facilities at the hotel.

(The city estimates these are worth at least $3.5 million, but there is something about the Belvedere that blinds sensible people to harsh reality. If the city can actually get $3.5 million for the Belvedere's restaurants and bars it will be good news -- and a miracle.)

As sad as a bankruptcy sale is, the sale of the Belvedere was not

without humor. Like when the bankruptcy judge, James F. Schneider, lavished praise on Frenkil and said: "Without [Frenkil], the city wouldn't have had this asset."

I think the judge should get a new dictionary. Mine defines asset as "something of value." In reality, the Belvedere was a huge liability to the city. And if the judge wanted to praise somebody, why didn't he praise the taxpayers of Baltimore, who were really the people who kept the Belvedere going?

But the funniest comment of the day came from Frenkil, himself, who was described as looking "somewhat chipper" at the bankruptcy hearing.

"If the city had ridden with me on this I'd be all right," he said. "But [the bank] wanted its dough and the city wanted their dough and they wouldn't ride with me."

And if anybody is planning a monument to this guy, I have just the inscription for it:

"Victor Frenkil -- He Sure Knew How To Take Us For a Ride."

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