Marriott keeps redevelopment on schedule
Handshakes and smiles were exchanged at South Lake Tahoe City Council Chambers Monday.
The South Lake Tahoe Redevelopment Agency in a special meeting unanimously approved the transfer of development rights from Heavenly Ski Resort’s parent company to Marriott International to build the $100 million Grand Summit Resort Hotel, slated for construction by June 1.
The amount paid to American Skiing Company for the development rights could not be disclosed, said Stan Hansen, senior vice president for ASC.
The new quarter-share hotel project, which will be the first of its kind for Marriott, will have a new name which has not yet been chosen, said Lew Feldman, attorney for the developer. The project, he said, will not be called the Grand Summit.
The project will be built simultaneously with the $129 million Marriott weekly time-share hotel. American Skiing Company sold Marriott the development rights for that project last year.
Both projects, located near the Heavenly gondola, are adjacent to each other and within walking distance to the Stateline casinos.
Doubts in ASC’s ability to finance the project caused concern about the start date for the project, especially in the wake of the Meristar Hotels and Resorts merger that fell through. In the deal, Meristar was to contribute $25 million to the construction of the Grand Summit. But Marriott’s extensive financial resources practically guarantee the project will be completed on time. The project is scheduled for completion by Oct. 31, 2002.
Councilwoman Brooke Laine welcomed Marriott saying the company is “competent and financially sound.”
Although ASC had been actively seeking a partner to finance the project, the deal between Marriott and ASC was worked out in a mere two-and-a-half weeks.
“We are anxious to move forward,” said David Holton, a representative for Marriott.
“I think the city interests have been protected and that has been the goal of the agency all along,” said agency member Tom Davis.
City Manager David Childs said the transfer will not have any significant impact on the existing development agreement, but will simply replace ASC with Marriott, which will internally finance the project.
The construction on the hotel must begin by June 1 or the redevelopment agency has the right to collect on a $3.5 million corporate guarantee. But officials are confident with Marriott’s ability and intent to begin the project as scheduled.
By mid-May, the two companies plan to finalize the deal, which requires ASC to sell 85 percent of its ownership interest in the project.
Marriott has 2,300 units in the United States and 59 other countries and territories.
American Skiing Company, with nine resorts across the country, is the largest Alpine ski resort operator in the nation.
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