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General Contractor Pulls Out of Partially Built Cambria Suites In Roanoke, Virginia;
Developer Plagued with Financial Problems from the Start
By Duncan Adams, The Roanoke Times, Va.McClatchy-Tribune Regional News

March 3, 2009 - On Thursday, general contractor J.M. Turner & Co. pulled its work trailers off the construction site along Reserve Avenue in Roanoke and shortly thereafter terminated its contract with the owners and developers of a partially built hotel intended to be part of the Cambria Suites brand.

In January, J.M. Turner had filed two mechanic's liens against owner the Roanoke Hotel Group for a total of about $1.4 million and shut down work at the site. Subcontractors were awaiting payment, too.

Mike Farris, Turner's president, said Monday that the Roanoke-based company still has not been paid.

"I'm afraid it's getting into a legal situation," Farris said.

He said he anticipates that Turner will be owed more money once the company completes a full accounting of its costs. The liens could allow Turner to collect what it is owed through a claim on the property.

Repeated phone calls to principals in the Roanoke Hotel Group and Wisconsin-based developer Telemark Hotel Group were not returned.

Citing the potential for litigation, Farris declined additional comment about the conflicts between Turner and the owners.

Early last month, two subcontractors said the Telemark group had been attempting to negotiate a lower contract price for the construction after citing the struggling national economy and related impacts on construction companies.

At the time, Farris acknowledged that the owners had pitched such proposals but was optimistic that differences could be resolved within a week or two.

Work at the site has stopped before.

Previous delays occurred when Telemark changed architects, appealed for city incentives or suffered financing challenges. At one point, the project sat idle for nearly a year.

Redevelopment

News first broke about three years ago about plans to build the upscale, 127-suite hotel in the South Jefferson Redevelopment Area near Carilion's Riverside Center development.

At the time, local officials celebrated landing another contributor to the area's redevelopment. Hotel construction began in May 2007.

The area is becoming a medical complex. Developers said the hotel's proximity to a medical clinic and new medical school under construction and to Carilion Roanoke Memorial Hospital could help fill its rooms.

Telemark acquired the site for the hotel from Carilion in 2006, which had purchased the land previously from the Roanoke Redevelopment and Housing Authority.

Cambria Suites is a franchise brand of Choice Hotels International, a publicly traded company based in Maryland. Its many other brands include Comfort Inn, Comfort Suites, Econo Lodge and Rodeway Inn.

In September 2007, the Roanoke City Council agreed to grant Telemark $1 million in tax rebates to help offset costs associated with adapting the hotel's design to avoid river flooding. The rebates carried conditions, however, including a requirement that the hotel open by September this year.

Now, with work halted, with liens filed against the property and the prospect of litigation, an opening by September seems unlikely.

"We told them that if we could get started by the first of March, we could have them in there by the end of the year," Farris said.

Meanwhile, he said the steel-and-concrete structure "should be pretty much weather resistant" until any construction might restart at the site.

"We've tried to protect the building," Farris said.

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To see more of The Roanoke Times, or to subscribe to the newspaper, go to http://www.roanoke.com/.

Copyright (c) 2009, The Roanoke Times, Va.

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