|By Donna Hogan, The Tribune, Mesa, Ariz.|
Knight Ridder/Tribune Business News
Oct. 15, 2004 - A plan to redevelop the fenced-up Mountain Shadows Resort in Paradise Valley may be close, but the property owner said nobody has the aged inn's future locked up yet.
"There is no agreement with anyone at this time," said Paul Gilbert, attorney for Host Marriott, which owns the 45-year-old inn and golf course.
Gilbert said, however, "there has been encouraging progress" in finalizing the resort's future.
On Sept. 3, Host Marriott closed Mountain Shadows, which basks in the shadow of Camelback Mountain at 56th Street and Lincoln Drive. The hotel, in need of an expensive rejuvenation, was losing its Marriott brand name, and Host Marriott decided to put it on the market rather than invest big bucks to make it competitive with the luxurious neighboring resorts. Host Marriott is keeping the golf course and clubhouse open for the time being. Neighbors and town officials are worried that the resort and golf course ultimately will be razed and homes built on the 70-acre site.
California-based Crown Realty & Development, which recently bought the nearby La Posada Resort, is the front runner for redeveloping Mountain Shadows, according to a source close to the negotiations. Crown spent $31 million to buy La Posada and plans to spend $75 million to restore the also-venerable Paradise Valley inn to its former elegance.
Crown's proposal for Mountain Shadows includes keeping the golf course and, "a resort component," plus other uses, the source said.
Crown principals would not say whether they have a nearly done deal for the property. And Gilbert would not say who is still at the negotiating table with Host Marriott, but he said two developers made the final cut. Town officials have long known that Crown and Scottsdale-based Westroc Hospitality were the contenders.
A spokesman for Crown did say Thursday that the company has the financial and administrative wherewithal to manage two major makeovers simultaneously.
"Doing both La Posada and Mountain Shadows is well within the ability of Crown," said spokesman Jason Rose. "For La Posada, Crown has assembled one of the finest local and national teams. That group is in place to do something as good, if not better, at Mountain Shadows." Westroc transformed the former John Gardiner's Tennis Ranch into the elegant Zen-themed Sanctuary Resort, also in Paradise Valley, and is in the process of a $70 million makeover of the Valley Ho in Scottsdale.
"We have been, and always will be, interested in Mountain Shadows," Westroc CEO Scott Lyon said Thursday.
Lyon said his plan for Mountain Shadows includes keeping the golf course and the original Mountain Shadows structures east of 56th Street.
Lyon also said he has the financial backing and experience to do two major hotel projects simultaneously.
"Valley Ho is already under development and fully capitalized," he said. "I've got plenty of resources to make Mountain Shadows happen." Paradise Valley Mayor Ron Clarke said that with either choice the town would have a resort instead of just a few dozen new homes. If any developer tries to make the property all residential, the town is ready to battle back, he said.
"The resort industry is key to our town," Clarke said. "The town derives a great deal of revenue from the resorts in bed and sales taxes. We do not plan to allow a reduction in our revenue steam." And residents depend on resort amenities such as restaurants and golf to enhance their quality of life, Clarke said.
He said Paradise Valley is ready, "to assist resorts in remaining competitive in the marketplace," but that does not include subsidies.
"This town is not in the position to offer financial incentives," he said.
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