Harbor Court sale considered imminent

New owner would maintain the `status,' `charm' of luxury hotel, developer says

`We're working with a terrific buyer now'

September 17, 2005|By June Arney | June Arney,SUN STAFF

The Harbor Court Hotel could be sold in as soon as a month, and if the sale proceeds as expected, the new owner likely will retain the name that has signified luxury in Baltimore for more than 20 years, according to people involved in the sale.

"We're working with a terrific buyer now," said Edward C. Roohan, president and chief operating officer of Castle & Cooke, the Los Angeles-based development company controlled by Harbor Court owner David Murdock. "This is an independent group but first-class all the way, with a wealth of hospitality experience. Their plan and vision is to continue to maintain the five-star status and the charm that is the Harbor Court."

Roohan and others declined to divulge the names of that potential buyer or any others.

The Harbor Court is expected to fetch a price of $85 million or more. It contains 195 rooms, 72,000 square feet of office space and an attached garage with 530 spaces. The office space is expected to be 90 percent occupied by year's end.

Condominiums associated with Harbor Court would not be part of the sale.

One of the first upscale hotels in the revitalized Inner Harbor, Harbor Court has remained privately owned and operated since it opened in 1986.

"The attractiveness and competition for luxury assets is higher than any other product in the lodging sector," said Warren J. Marr, director of hospitality and leisure advisory services for PricewaterhouseCoopers in Philadelphia. "This hotel has its own local brand recognition. An argument could be made that if it has a high occupancy, how much of a lift would it get from being branded?"

In a clear indication that a sale is imminent, the hotel's current owner has filed papers notifying employees that they may be laid off, as required under federal law if a sale is pending within 60 days.

The notice is mostly a technicality required by a change in ownership.

Most, if not all, of the hotel's 264 full-time employees would probably be rehired by the new management, said Werner Kunz, managing director of the hotel since 1987.

Often, to make sure employees aren't left temporarily unemployed or uninsured, paperwork is completed a week or so before a property is transferred to allow a seamless transition, Roohan said.

"We have never laid off anyone in 20 years," Kunz said. "When you sell a hotel, the day of closing, you lay off 100 percent of your staff, and you hire them back the moment the papers are signed."

When a hotel chain buys a property, it often wants to bring aboard its own general manager, comptroller and maybe another staff member to make sure that the brand's system is quickly established.

Kunz said he does not know whether he will stay on under new ownership.

"I have the opportunity to look at who is going to be the boss, and they can look at me and say, `He's too much of an entrepreneur, he doesn't really fit in,'" he said. "It's happy and sad. I've reached a pinnacle with the hotel and my staff, and it's sad that maybe I'll have to do something else."

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