|By Kathy Bergen, Chicago
TribuneMcClatchy-Tribune Regional News
Oct. 17, 2007 - The Chicago-based owner of the hurricane-damaged Hyatt Regency New Orleans is expected to announce Wednesday that it has agreed to sell the shuttered hotel.
With 600 blown-out windows the hotel became something of a poster child for the devastation wreaked by Hurricane Katrina two years ago.
Strategic Hotels & Resorts Inc. will sell the 31-story atrium tower adjacent to the Louisiana Superdome to Poydras Properties Hotel Holdings Co. for $32 million, of which $3 million is a note, payable in six years.
Poydras executives could not be reached for comment.
The price is about one-fifth what Strategic paid for the business hotel in 1997, said Laurence Geller, the firm's chief executive, who was leading efforts to revitalize the downtown area, with a proposed jazz center as its centerpiece.
The hotel investment company's move into more luxury properties in the past two years made this business hotel a less comfortable fit in its portfolio, Geller said.
This year Strategic received $143 million, after deductibles, in an insurance payout on the property. Strategic has spent about $60 million for repairs and upkeep costs, Geller said.
Last year Geller spearheaded plans to rebuild the hotel within a proposed 20-acre performance-arts park to be anchored by a National Jazz Center. He said it was a tough decision to sell the hotel.
"I have a tremendous emotional attachment, but in a hard-nosed way, we probably wouldn't buy New Orleans again today if it was available ... so we needed to sell," he said.
"And in a personal sense, I have been disappointed with the incredible lack of coordinated progress for the city of New Orleans," he said. "It's a national shame."
Still, he expressed optimism that the new owners would finish rebuilding the hotel, and that the National Jazz Center project would go forward.
"We're donating all the plans we've done for the jazz center," he said, estimating the value of the plans at $6 million, including designs by Pritzker Prize-winning architect Thom Mayne.
"Personally, I'll stay supportive of the jazz center," he said. "I'd like to see it built and I'd like to attend the first concert."
The 20,000-square-foot center would house the New Orleans Jazz Orchestra, and was to anchor a proposed 20-acre performance-arts park.
Movement toward establishment of the park has been stalled. However, the New Orleans Times-Picayune last week reported preliminary movement on revised plans, which would involve state purchase of storm-damaged properties that could be reused as government offices, entertainment venues, parking, retail and possibly housing. A public park, akin to Millennium Park in Chicago, remains part of the vision.
The hotel sale is expected to close by year-end. The company declined to forecast the deal's impact on its earnings.
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