By Kate McGinty, The Desert Sun
December 4, 2009
The long-awaited Ritz-Carlton in Rancho Mirage must open for business by June 2011, the City Council decided Thursday.
Under a new operating contract with the hotel, which was approved 4-0, the city laid out details of a modified financing agreement and set a new deadline for the hotel to open for business.
The Ritz-Carlton, in the Santa Rosa Mountains at the top of Frank Sinatra Drive, must open its doors by June 30, 2011.
The hotel — which is “coming back to life”— plans to pick up construction by March to make that happen, project attorney Emily Hemphill said.
“I think finally I can stand here and tell you we are making significant progress,” she said.
The previous hilltop hotel, The Lodge, shut down in August 2006 to be renovated into the Ritz-Carlton. The city estimated it would raise at least $1.2 million in annual transient occupancy tax.
Construction came to an abrupt halt last year, though, after Lehman Brothers Holdings Inc., a major investor, filed for bankruptcy.
That left about 80 percent of the project complete and more than 200 people without jobs.
Now, the hotel is on the cusp of clearing its debt on the project and an equity partner is buying the lender note, Hemphill said.
The hotel will next secure a construction loan, which Hemphill estimated could be about $50 million.
Construction is then expected to take about seven months, City Manager Pat Pratt said.
Hemphill was optimistic the hotel could open ahead of schedule.
“I don't think it would be very long. My guess is if we could get started in the first quarter of the year, that we would be open for the subsequent season,” she said.
Councilman Dana Hobart said Rancho Mirage residents and the rest of the Coachella Valley have eagerly awaited the opening, and its progress is a sign the valley can flourish.
“The completion of this project will be evidence to all of the world that the Palm Springs valley is a tourism destination that is a vibrant destination, regardless of world and national distress,” he said.
Thursday, January 14, 2010
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