Lodging Unlimited performs newsworthy services
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"Hotel Doctor" Has Plan for Drawbridge
(Wednesday, 30 December 2009)
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December 30, 2009
'Hotel doctor' has plan for Drawbridge
By Mike Rutledge
Cincinnati.com
mrutledge@nky.com
FORT MITCHELL - The Drawbridge Inn underwent holiday layoffs this month as it works its way out of bankruptcy, but the man hired to return it to profitability said he is confident the 400-room hotel will be successful again.
The economy and other factors make it too early to predict when that will happen, said so-called "hotel doctor" Morris Lasky, chief executive officer of Chicago-based hotel management company Lodging Unlimited.
Lasky is known for reversing the fates of failing hotel properties and his 40-year-old firm has managed or consulted on more than 300 problem facilities worth $7 billion.
Passing motorists on Interstate 75 and others in the community soon will see improvements to the 39-year-old Old English-style landmark at the Buttermilk Pike interchange.
"The first thing - and you'll see this in the next two or three weeks - is the sign will be repainted, because that sign is very unattractive," Lasky said. "Our vans that go to and from the airport will be repainted."
There will be new colors and employees in uniforms, he said. "It'll begin to take the form of, 'Boy, I'd like to stay there,'" Lasky said. Free apples will be available in the lobby. Cookies will be baked through the day for guests. And room rates will drop a bit from their current level around $60 per night.
A full marketing staff is generating new business for the spring and fall at the hotel that has 30,000 square feet of event and exhibit space, and, "We're beginning to see some results from that already," he said.
Lasky started his job as a U.S. bankruptcy-court-appointed receiver the second week of December. The hotel's mortgage holder is Franklin Pacific Finance.
"We're kind of into what I will call fighting shape - this thing will work," Lasky said. "I've seen a whole lot worse that have worked, too, but this one has every reason (to work)."
Lasky declined to say how many employees were let go, other than calling it "a lot." Those laid off will top the list for rehiring if revenues improve, he said.
The Drawbridge had a staff of 100 full-timers and 60-part-time employees, but some of them were hired by McHale's Hospitality Group, which Lasky hired to operate the hotel's banquet facilities so the hotel wouldn't have to do it.
"When we had our meeting literally to lay off the number of people we had to lay off, (Chuck) McHale was there with his team to interview all the people in the catering operation," Lasky said. "We wanted to do the best we could for the people. I mean, you feel kind of cruel during Christmas to do this kind of thing, but the fact of the matter is: The choice was to either close a hotel or lay off a number of people so the property could survive."
A couple of restaurants at the hotel were closed, but Josh's Taverne and Grille and the Crossbow nightclub remain open. The hotel has the bar's food available, plus free continental breakfasts each morning. A "New Wave Lobby Mart" with microwave ovens plus pizzas and other quick snacks has opened in the Drawbridge lobby.
McHale's took over banquet operations around Dec. 20 and already is booking banquets, which will fill rooms in the future.
"It's a nice property, it just needed some experienced help," Lasky said. "Physically the property is in pretty good shape - I was very pleasantly surprised to see all of that - it's just that things had gotten kind of out-of-hand," he added, adding expenses were too high "for what was happening there."
The family of Nathan Deters bought the hotel in January 2004, saving it from bankruptcy and promising to make it a success. They invested millions in remaking the facility, but the recession and a difficult borrowing market made business difficult, especially when revenues failed to meet expectations this summer.
"Nathan (Deters) has been a knight - literally - for the Drawbridge Inn. He has been a real star, and he's been very, very helpful, and a nice guy," Lasky said. In fact, all the Deters have been: "I always feel bad about this kind of thing, because bad things happen to nice people."
Deters declined to comment, saying he believed to do so would be inappropriate.
Additional Facts
Too many rooms at the inn
The hotel business nationally is about to go through a rough patch, predicts Chicago-based "Hotel Doctor" Morris Lasky, who typically spends a couple days per week in town trying to return the Drawbridge Inn to profitability.
"There are about 2.5 million hotel rooms in the country today," he said. "About half those are vacant every night."
"To give you a better picture of that, a hotel to break even and carry debt service has to run around 70 percent occupancy," he said. For one that doesn't have debts to break even, "you have to run about 55 percent occupancy. The average now in the country is 52 (percent), so that's got to tell you that we're at the beginning of a time where the dam will break, and it's very predictable.
"I've been through seven, eight, nine cycles since I've been in the business (about 50 years)," he said.
What will force the issue is auditors who now are looking at banks that hold hotel mortgages and are telling them to classify loans as good or bad, rather than carrying them as good assets on their books, he said: "Once that happens, the dam will break and the receivers will be appointed," he said. "That's what will happen with a tremendous number of hotels in the country."
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