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Grand Heritage Hotel Group Acquires Historic
 Governor Hotel in Downtown Portland

By Jeffrey Kosseff, The Oregonian, Portland, Ore.
Knight Ridder/Tribune Business News 

Oct. 24, 2003 - The downtown historical landmark Governor Hotel received a new lease on life this week, and with it, Portland will get a new corporate headquarters. 

The new owner also plans to renovate the Governor, reopening the hotel's fourth-floor grand ballroom, which has been closed to the public for 80 years. 

Grand Heritage Hotel Group, which owns and operates 12 hotels nationwide, said Thursday it has bought the hotel from investors who faced a foreclosure lawsuit filed by lenders. 

Grand Heritage will move its 19-employee headquarters from Annapolis, Md., to downtown Portland. 

John Cullen, Grand Heritage's president and chief executive officer, would not disclose the deal's terms. 

"The price was attractive enough for us to be able to afford putting in $4 million in improvements immediately," Cullen said. 

Representatives of the hotel's former owner, Governor Hotel Associates, did not return calls for comment Thursday afternoon. 

Endeavour Capital of Portland provided capital for Grand Heritage's purchase and companywide expansion. 

The Governor Hotel, at 611 S.W. 10th Ave., has 100 guest rooms and suites and 13 meeting rooms. Built in 1909, the hotel is listed on the National Register of Historic Places. 

Cullen's company will spend nearly $1 million to reopen the grand ballroom. 

"Here is probably one of the most magnificent architectural rooms in the city that's been closed off," Cullen said. "It's in mint condition." 

The company will convert the Governor's Southwest 11th Avenue lobby into its main entrance. Cullen would not speculate how the changes would affect Jake's Grill, the building's restaurant on the 10th Avenue side, near the hotel's current main entrance. 

McCormick & Schmick's, the restaurant company that owns Jake's Grill, said it would like to expand once the hotel moves its main entrance to Southwest 11th Avenue, although it has no concrete plans. 

"We're more than willing and excited to take those opportunities," said Gregg LeBlanc, director of marketing at McCormick & Schmick's. 

Also announced Thursday, former Portland Trail Blazer Larry Steele and partner Dennis Sivers will open a new health club and spa in the Governor, replacing the building's current health club and expanding its space. 

Steele said he hopes to begin renovations within 30 days, keeping part of the club open during the changes. He said he does not yet know the new club's name. 

Cullen said his company hopes to operate between 60 and 100 hotels in three years, including some in Europe. As it expands, he said, the company hopes to employ more than 100 people at its Portland headquarters in the next few years. 

He said setting up shop in Portland could make it more difficult to explore foreign markets because the city lacks many direct flights to Europe, but he said the area's quality of life is irresistible. 

The Portland Development Commission provided about $125,000 worth of loans and credits, Cullen said. 

-----To see more of The Oregonian, or to subscribe the newspaper, go to 

(c) 2003, The Oregonian, Portland, Ore. Distributed by Knight Ridder/Tribune Business News. 


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