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Recent Court Documents Indicate Sale is in the Works for Semiahmoo Resort
Near Bellingham, Washington to Warnick + Co. but No Deal is Imminent

By John Stark, The Bellingham Herald (Bellingham, Wash.)McClatchy-Tribune Regional News

Aug. 30, 2012--BLAINE -- A sale is again in the works for Semiahmoo Resort, but no deal is imminent.

So says Harry Chesnin, attorney for the Upper Skagit Indian Tribe, the majority owner of the resort. Chesnin noted that once a sale agreement reaches its final stages, federal labor law will require the present owners to give 60 days' notice to the resort's roughly 300 employees of the potential ownership change that could threaten their jobs.

As of this week, Chesnin said, no such notice had been given.

The possible buyer is Warnick + Co., a Phoenix-based firm that handles turnarounds for resorts and hotels experiencing financial problems, according to the company's website. Warnick did not respond to requests for more information.

"They (Warnick) have a pretty comprehensive history of management, of upgrading things," Chesnin said.

The possible sale to Warnick was revealed in a recent court document in the bankruptcy reorganization case of David Syre, the Bellingham developer who launched Semiahmoo Resort in 1987. In that document, an attorney representing Washington Federal objects to some of the financial information submitted by Syre and his attorneys as they attempt to work out a plan to pay off Syre's creditors, including Washington Federal.

Seattle attorney Richard Schroeder's court filing contends that Syre has personally guaranteed about $15.5 million in loans and related expenses to the hotel company. Now-defunct Horizon Bank made those loans. The money is now owed to Washington Federal because that bank took over Horizon's loan portfolio after Horizon's failure in 2010.

Schroeder then states that Semiahmoo Hotel Resort Co. has informed Washington Federal that the hotel is in the process of being sold to Warnick for $10.5 million, and after other expenses have been paid, no more than $8.4 million would be available to pay off the money owned to Washington Federal.

Chesnin did not address those financial details, but he flatly denied another statement in the document filed by the bank's attorney:

"The Semiahmoo Hotel Resort Co. has further advised WaFed that whether or not the proposed sale to Warnick is consummated, the Semiahmoo Hotel will be shut down and closed at the end of October 2012."

Chesnin said the hotel is "an ongoing business" that is continuing to accept reservations for dates after October.

"It's a wonderful time of year to visit the hotel," Chesnin said.

Washington Federal did not respond to a request for comment.

The resort hotel also appeared to be on the brink of a sale in late 2010. News of that deal leaked out after resort management did take the step of notifying employees of the pending ownership change. But that sale fell through in early 2011 after the would-be buyers were unable to raise the cash they needed to seal the deal.

Semiahmoo Resort, originally developed by Syre's Trillium Corp., opened in 1987 on the end of Semiahmoo Spit, a narrow stretch of land on the west side of Drayton Harbor that once housed a salmon cannery. It is among the largest resorts in the state, with close to 200 guest rooms and suites.

Trillium sold a majority ownership share to the Upper Skagit Indian Tribe in 2003.

Reach JOHN STARK at john.stark@bellinghamherald.com or call 715-2274.

___

(c)2012 The Bellingham Herald (Bellingham, Wash.)

Visit The Bellingham Herald (Bellingham, Wash.) at www.bellinghamherald.com

Distributed by MCT Information Services NYSE:GPC,NASDAQ:WFSL,



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