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Is There Hope For These Abandoned Hotel Projects?

Where: Various Locations
February 28, 2013 at 12:38 PM | by | Comment (1)

Given how excited we get for new hotels and how annoyed we become at delayed openings, you can understand how abandoned hotel projects -- that is, those that have been indefinitely placed on the shelf post construction but pre completion -- tug at our heart strings. It's no good for us as consumers, and it's certainly no good for the cities who have to live with their fallout.

Some abandoned projects end up working out for the city (like the Ambassador Hotel project in Los Angeles that turned into a school), but most don't sit so pretty, becoming eyesores or, worse, stagnant reminders of what could have been, as in the case of Vegas' Fontainebleau.

As we look around the world at some of the unfinished hotel business, we really get a sense for how hard the economy has been over the past few decades for the hotel industry, even for established and successful brands like the Ritz Carlton. Below, we've put together a list of examples. We'll keep an eye on these suckers, but we don't advise getting your hopes up.

Ritz-Carlton, West Caicos: We told you almost five years ago that the construction company wasn't paying its workers, and we haven't heard a peep since (even though its website is still up and running). Perhaps it's all for the better, though, as there were some environmental concerns surrounding the hotel's development of a virtually uninhabited island. It was supposed to be located near Molasses Reef, where it's rumored that Columbus' ship, the Pinta, went down. Buried treasure? Maybe. But it's pretty clear this Ritz has sank.

Fontainebleau Resort, Las Vegas: Well, it is certainly not a good sign when a hotel sells off all the furniture it bought -- that's pretty much saying, "Hey, we're dead in the water." This $2.9 billion unfinished hotel became the nation's largest commercial project to go bankrupt when it did in 2009. Billionaire investor Carl Ichan bought up some of the dead weight for $150 million, but made it very clear he wouldn't have the capital to finish the job. Last year, Morgan Stanley jumped in and bought up $320 million's worth of the debt, however that did not come along with any plans for reinvestment. And so, we continue to wait. The hotel is about 70 percent finished and is currently the tallest building in Vegas.

Benghazi Grand Hotel, Libya: This one is at a pretty interesting standstill, a case of developers versus the local people. The now abandoned former Grand Hotel was supposed to undergo a $170-million renovation to turn it into the five-star Qasr al-Jazeera Hotel. But the project hit a snag back in November when the city flip-flopped on its decision to allow the Grand Hotel to be demolished. Protesters were able to obtain a warrant to stop the demolition, and the locals showed up in force to help restore what had already been damaged. They even hung a sign out front that read, “Benghazi’s historic buildings are not for sale.”

Racz Hotel & Spa, Budapest: One of our editors got the scoop on this during a recent visit to Budapest. According to locals, the hotel was finished about two years ago and has "just been sitting there ever since." It was set to be the best, newest spa hotel in the city with an 86,000 square foot thermal spa with 13 pools (wow!), but there was "some disagreement between the hotel developers and the city about who should pay for the thermal baths component of the hotel." There were reports that the hotel would open in early 2012, but now it seems this property has entered hotel purgatory as there as been nothing in the news of late.

Ryugyong Hotel, North Korea: We'll end with a project that has a chance to find itself a happy ending. Nicknamed the "Hotel of Doom," this 105-story pyramid-shaped project began in 1987 and was supposed to be finished in 1989. Yes, 1989! But economic downturn put things to a halt and poor construction quality threatened to put an end to it in the 90s. According to recent reports, it is now believed it will finally open this year at some point, but only with half the 3,000 proposed rooms. After 25 years of waiting, we'll believe it when we see it.

Know of any abandoned projects in your city? Let us know in the comments below!

[Photos:Wiki Commons]

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Downtown LA: The Clark and The Embassy

Still vacant after I did a walk-through in February 2011 as furniture was being placed. Over 500 high end rooms and suites would have helped the growth of our city, and still rumors about Union and local government disagreements keep these projects on hold.

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