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Wednesday, May 27, 2009

Not pencilling out

A reader in Texas writes:

I thought I'd pass along a little "market reality" on what things might look like when Portland gets its own stupid HQ hotel--



San Antonio used empowerment zone bonds -- creating jobs for low and moderate income inner city residents -- for its "Grand Hyatt." Enjoy!

It's going to be a little difficult paying of that quarter billion of public debt at a hundred bucks a night.

Comments (4)

That's actually a pretty darn good price. May have to head down to TX to check it out!

Where was the Grand Hyatt when I was there for my cousin's wedding? Everything else on the Riverwalk was >$200.

Doesn't matter - If they don't make a profit, the operator won't have to pay toward the debt the way they'll write it up.

Of course, the operator determines profit, so be prepared for a long wait for debt service.

Agreed, Steve: it's always amazing how the books can be serviced to show that the venue never made a profit, no matter how many dumptrucks full of cash you watched leave the back door.

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