|By Jim Balow, The Charleston Gazette,
W.Va.McClatchy-Tribune Regional News
Jan. 13, 2011--CHARLESTON, W.Va. -- The Charleston Marriott Town Center, one of the city's premium hotels for the last 28 years, is about to be sold.
Charleston Urban Renewal Authority board members on Wednesday approved the assignment, or transfer, of CURA's long-term ground lease for the hotel from Forest City Enterprises to the Inland American Lodging Group.
Ed Chanatry, a vice president with Forest City Commercial Group, said no deal has been made yet, but one is expected in the next two months.
"We have entered an agreement with Inland American Lodging, part of Inland American Real Estate Investment Trust or REIT," Chanatry said. "We are exploring the possibilities with Inland.
"Marriott management and employees would remain in place," he said. "It would be a seamless transfer. It would remain a Marriott."
Mayor Danny Jones, who attended the closed-door CURA meeting Wednesday morning, had little to say about the proposed sale.
"It's a Marriott now. It'll be a Marriott," Jones said. "I don't think anyone will know the difference. It's not a done deal. It's very preliminary."
Since Forest City and Inland American are publicly traded companies, any sale would require approval by both boards, Chanatry said.
"Forest City has made a strategic decision to explore a sale," he said. "Forest City's core business is retail, offices and multifamily housing -- apartments -- that we manage across the U.S. We have very few hotels -- four -- and have made a strategic decision to exit them."
The agreement with Inland American involves only the Marriott, however. Forest City's other hotels -- two in Pittsburgh, one in Cleveland -- are not included, he said.
Cleveland-based Forest City Enterprises built both the Marriott and Charleston Town Center in the early 1980s, all on property owned by CURA. CURA still owns that land.
CURA signed a 50-year lease for the Marriott in December 1980 with In Town Hotels Ltd., CURA Director Pat Brown said, that went into effect when the hotel opened in 1982. Each year, CURA receives $50,000 plus 0.5 percent of gross revenues, he said.
The revenue share topped out at about $93,000 in 2008 and dropped to about $84,000 last year, he said. The terms will remain in place if and when the lease is transferred.
"I think the judgment was we'll be at least as well off, if not better off [with the new owners]," Brown said.
Forest City owns 95 percent of the hotel, Brown said. The other 5 percent is held by Sam Huff, the former WVU and NFL football player from Farmington. Chanatry said Huff has agreed to sell his share.
The Inland American Lodging Group is the hotel-owning arm of Inland American REIT, spokesman Joel Cunningham said. Inland American, in turn, is just one of four REITs owned by the Inland Real Estate Group of Companies of Oak Brook, Ill. The group has $25.8 billion of assets in 47 states, according to its website.
Inland American already owns many Marriotts, along with other brands, a June 2010 news release says. With the acquisition of four Marriott properties then, the company owned 54 under the Marriott brand, it said.
Chanatry deflected a question about the value of the Charleston Marriott, saying, "Whatever we can get for it." According to the Kanawha County assessor's office, the hotel and its parking garage are currently valued at $13.1 million.
Reach Jim Balow at email@example.com or 304-348-5102.
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Copyright (c) 2011, The Charleston Gazette, W.Va.
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