The Trenton Times published the following article on February 22, 2013. To read the full article, click here.

Trenton Marriott management company asks city council for $295K

By Erin Duffy/The Times of Trenton 
on February 22, 2013 at 7:45 AM

TRENTON — The management company for the Trenton Marriott hotel came before council last night with its second cash call in as many years, asking a skeptical council for another $295,000 to keep the distressed hotel running.

The cash request comes as the city-owned hotel prepares to transition to a Wyndham once its franchise agreement with Marriott expires in June. Robert Winchester, the president of Waterford Hotel Group, the management company whose contract with the hotel also ends in June, said the hotel needs a $295,000 infusion from the city to keep cash flow stable through June.

As part of the contract between Waterford and the Lafayette Yard Community Development Corp., the public board that oversees the hotel, the city must maintain a $200,000 balance in an account to fund operations. If revenue dips below that amount, Waterford reserves the right to request additional funds from the city.

Council did not vote on the cash call last night, but is expected to approve or reject the request March 7 after another presentation from the hotel, its new franchise and new management company on March 5.

Council gave Waterford $500,000 last year upon request to help the hotel survive through the traditionally slow winter months, and as payback, the city saw a reduction in its $1.3 million annual debt service, business administrator Sam Hutchinson said.

Frustrated council members said they were unhappy to see Waterford and members of the Lafayette Yard board show up again with their hands out to fund a hotel that was called both an “abysmal failure” and a “white elephant” by Hutchinson and Councilman George Muschal.

“The hotel has been silent on everything other than when it comes to council and it needs money,” Councilman Zachary Chester said. “Fool me once, you know?”

Council members asked Hutchinson where the city would find the money and whether it would ever be repaid by the hotel, which has operated at a loss or just broken even every year since it was built in 2002.

“This was supposed to be a loan, the money you’re asking for,” Councilwoman Marge Caldwell Wilson said. “Or are you just asking the city to give it to you?”

“The hope is that the hotel will generate a profit with a new company,” Lafayette Yard chairman Cleve Christie said.

The city still owes more than $14 million worth of debt on the $60 million building and could be on the hook for millions more as Wyndham takes over and demands renovations to bring the hotel up to its standards, Hutchinson said.

“There are big, big, big dollars that are going to be required,” he said. “This cash call is probably $300,000. It’s probably 10 times that amount that’s going to be required.”

Council President Phyllis Holly-Ward scolded Winchester and Christie for not following through on promises that council would be kept updated on the hotel’s operations and finances after last year’s cash call. Councilwoman Verlina Reynolds-Jackson said last night’s presentation was woefully short on details.

“Right now, these numbers are just numbers without anything behind them,” she said, pointing to a spreadsheet provided by Waterford and Lafayette Yard.

Asked about what went wrong with the Marriott, a defensive Winchester said Trenton was a tough city to operate in, but Waterford, which came on board five years ago, had managed to decrease the hotel’s losses each year.

“I think the circumstances of the property are what they are,” he said. “It’s a downtown hotel in a city that has some issues that we work on and work on what the perception is.”