Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: MONDAY, February 17, 1992 TAG: 9202170191
SECTION: VIRGINIA PAGE: A-1 EDITION: METRO
SOURCE: DANIEL HOWES BUSINESS WRITER
DATELINE: LENGTH: Long
HOTEL PROJECT AWAITS RESCUE
In 1881, the railroad staked its claim in Roanoke, buying the 800 acres now occupied by Hotel Roanoke and the office buildings across North Jefferson Street.But come the end of the month, some 1,000 Norfolk Southern Corp. workers will begin moving into their new regional headquarters, leaving a ghost town on the hill the railroad built. Plans for the former fulcrum of corporate power and civic style now are struggling or non-existent.
The pressure is on to revive the hotel.
Empty more than two years, the grand old lady stands waiting for her new protector to engineer a comeback. Long gone are the hotel's travelers and diners and socialites. Conferees and trainees and guests will soon return, insist Hotel Roanoke's current owner, Virginia Tech, and its development partner, the city of Roanoke.
Trouble is, the developer chosen last spring to resurrect the hotel and build an adjacent conference center is now history - and so may be the eight months of marketing plans, design schemes and other site work. Officials still aren't sure.
Increasingly, the hotel seems a victim - of a founder who didn't want her anymore and a new owner struggling to revive her; of a sick economy allergic to hotel development projects; of a location so close, but so far, from the sporadic downtown bustle.
But perhaps more than anything, she's a victim of her fame. The news media clamor for every nugget of news; historic preservationists establish funds to help with renovation; citizens want to know when she'll reopen, and scarcely a voice can be heard to oppose the project.
Talk about high expectations.
"Everybody from an emotional and sentimental standpoint wants it to open," said Gilbert Butler Jr., a Roanoke developer and attorney. "But what if it fails? If it fails, it will reflect on [City] Council and the political fallout will be horrendous. If the people on council don't keep their eye on the ball, they'll get in a heap of trouble."
With the exit of Classic Properties of New Orleans come signals that council wants to bring the hotel back, whatever the risks. "There are two great realities over there: abandoned, vacant buildings or bustling activity," Brian Wishneff, the city's economic development chief, said Friday.
City officials recognize they cannot afford the ghost town the railroad built. So financial commitments to the project appear to be increasing - behind closed doors. "What the city may have committed to during negotiations and what we've said formally at this time may be a great deal of difference," Wishneff said.
"You shouldn't necessarily think [that] what we've done or what we're prepared to do is only what we've said publicly at this time," he continued. "We can get creative at times." But he refused to elaborate.
The message seems clear: $10 million in city guarantees - a $6 million federally backed loan and $4 million in tax-free revenue bonds for the conference center - wasn't enough for Classic and it may not be enough for others.
Though details of the abortive negotiations are nearly impossible to come by, it seems the city, not Tech, is being asked to up the ante. No surprise, really, because Roanoke needs the new hotel more than Tech needs a new conference center.
Tech, for its part, has said repeatedly it will not commit any funds to the project that would be used to run the university and its programs. President James McComas can't afford to break that vow, not with state budget cutbacks gutting programs, creating faculty vacancies and swelling classes.
Indeed, one university official predicted that news of Classic's exit will send "some tremors" through the faculty and could reignite smoldering opposition to the project. "It's going to sharpen the debate internally," said the official, asking not to be identified.
A renovated hotel and new conference center would cement Tech's presence in downtown Roanoke, achieving McComas' twin goals of broadening the university's public service mission and drawing it closer to Roanoke. But Tech could return the hotel to its previous owner, Norfolk Southern Corp., and walk away.
For boosters of the Roanoke hotel, such a failure is unthinkable.
Valley power brokers recruited for a hotel advisory committee regard Classic's firing as fairly typical for such a complicated project. "My experience as a lawyer on these things is like the carpenter's old adage: You've got to measure twice and saw once," said John Rocovich, a committee member.
If nothing else, the hotel's popularity is keeping the dream of its rehabilitation alive. Planners appear to be using the momentum - and the breathing space - to fashion a deal that's politically palatable and financially feasible.
"Too many people want this deal for it not to happen," said David Saunders, a Roanoke real estate developer. "If it costs the city $42 million, they're going to do it. As far as I'm concerned, the deal's not dead. We've got to get somebody in the deal who can make the deal."
Who that somebody may be is uncertain, officials say. Early speculation among area contractors and others is mentioning Henry Faison, the Charlotte, N.C., developer who owns the Dominion Tower and Valley View Mall. Faison's firm submitted one of the seven bids for the hotel project when Classic Properties was chosen.
Briefings and consultations with two Tech boards and City Council are scheduled for today and Tuesday, as planners from Tech and the city try to decide on their next step. Officials say they likely will either re-examine old bids or solicit new ones, a time-consuming process that would delay the hotel's reopening even further.