Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, May 13, 1993 TAG: 9305130092
SECTION: BUSINESS PAGE: B8 EDITION: METRO
SOURCE: GEORGE KEGLEY STAFF WRITER
DATELINE: LENGTH: Medium
Daniel Ingalls, head of Virginia Hot Springs Inc., said he hopes to close the transaction in about a month so the resort can follow its improvement plan later this year.
About a dozen investors have expressed interest in the project since December when the hotel company hired a Baltimore investment banking firm to help find capital for the upgrading.
Ingalls said he's satisfied with the proposals, mainly from organizations in the hospitality industry who are in a position "to add value in the property by working with us."
Repainting of guest rooms and improvement of some meeting rooms already has been completed, he said, but more extensive work depends on the financing.
The hotel's three-year plan provides for a new entrance and major renovations for buildings, golf courses, trails and other features.
Business increased 15 percent for the fiscal year ended in March, and late winter snows helped boost sales 57 percent in the quarter, he said. "We were nearly full every weekend of the ski season . . . and we're sold out for many days in May."
After several years of low occupancy and multimillion-dollar annual losses, the resort is "in the midst of quite a turnaround," according to Barron's, a national financial newspaper.
People are coming back to the hotel and "everything is going in the right direction," the paper said in an article published in March.
"The company certainly possesses the attributes that should interest a financial partner," Barron's said.
In cost-cutting moves, the hotel has quit developing houses on its land and has leased its farm and garage to outside operators because they had a low profit margin, Ingalls said.
About 56 homes were built in the company's North Ridge and Deer Lick areas, but marketing was slow because of a lack of expertise in the real estate business, he said. When home construction is resumed, Ingalls said, the firm will work through someone who knows the real estate field.
by CNB