Jan. 11, 2013--NEWPORT NEWS -- The Omni Hotel sign visible from J. Clyde Morris Boulevard has been blacked out. In small lettering on directional signs that lead visitors to the hotel, it says "Newport News Hotel and Conference Center."

The hotel -- which was the subject of a planned private auction in 2011 on a non-performing $13.4 million loan -- no longer is an Omni-brand hotel, replaced by the Newport News Hotel and Conference Center at the beginning of 2013.

A representative with the Omni chain released a statement saying that the franchise agreement expired.

"Omni's franchise agreement with the Newport News hotel had come to an end, and both parties agreed to move on at the close of the term," said Anne Tramer Brownlee, an Omni spokeswoman, in an email response to a question.

A local hotel manager who declined to give his name declined to answer questions Thursday, beyond saying that the name change was a mutual decision. An official with the parent company, Economos Properties in Boca Raton, Fla., referred questions to Newport News hotel managers.

The reasons for the change are uncertain, but Robert Beck, the owner of four hotels in Newport News, including the Holiday Inn Express and Mulberry Inn, said he believes the property continues to be financially troubled.

He said the local hotel probably couldn't meet the Omni corporation's appearance standards. The Omni underwent major renovations in 2004.

Beck said that the presence of the nearby Marriott Hotel and Conference Center, built in the mid-2000s at City Center, spelled trouble for the Omni. The former Omni has a 5,800-square-foot ballroom, but the taxpayer-funded Marriott conference center features a 12,000-square-foot main ballroom, plus smaller spaces. The city spent $26 million in taxpayer funds building the 23,000-square-foot conference center, turning the operation of the center over to the Marriott.

"I don't know if the (former Omni) hotel is going to survive. It depends on how much worse things get. It's touch and go," Beck said.

Florence Kingston, the Newport News economic development director, said it's unfair to blame the Marriott for the Omni's problems. She said there could be a number of factors causing financial problems for the hotel not necessarily related to the Marriott's presence in the market. She said the former Omni's grand ballroom was not spacious enough to serve the community.

Prior to the Marriott, the Omni was often the go-to hotel for large gatherings in Newport News.

As for the 2011 auction, Kingston has said that just because an auction was scheduled doesn't mean the property will shut down. It could have been a way to restructure debt.

Earl Wynings, a Newport News assessor, said that he doesn't know if the auction took place, but if it did, the financial institution with the winning bid could obtain the hotel's outstanding loan for a heavily discounted price.

Wynings said that could result in the financial institution with the winning bid eventually taking control of the property. As of Thursday, the property hadn't changed hands, Wynings said.

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