Pullout of a Partner Stalls Construction of Symphony Towers Hotel

A partner in the hotel portion of the $143.5-million Symphony Towers project has pulled out, leaving the developer hunting for a replacement $7.5 million from its Eastern partners.

Construction of the 12-story, $30-million Marriott Suites hotel was scheduled to begin this week, but Douglas Wilson, Charlton Raynd Development Co.’s managing partner, said Monday that the setback will cause a delay of 30 to 90 days.

At California First Bank, which had made the $7.5-million investment a condition of its $30-million loan, Vice President David Walters said the pullout will take at least several months to overcome.

Both men said the balance of the B Street project, which includes a five-story parking garage and 23 floors of office space, will not be affected.

Guy F. Atkinson Co., the San Francisco firm that Wilson said pulled out, is the parent company of general contractor Walsh Construction Co.

Leo Heagerty, Atkinson’s director of corporate relations, said he could not comment on the move. Asked if Atkinson is considering rejoining the partnership, he said, “That’s the heart of the matter, and I just can’t say anything yet.”

Walters said California First--which is 77% owned by Bank of Tokyo Ltd. and is the lead lender on the rest of the Symphony Towers project as well--”is simply waiting” for another investor. He said there are several requirements for the type of loan needed, but declined to discuss specifics.

Wilson, of Charlton Raynd Development, blamed “control issues” for the split with Atkinson. But he was upbeat about prospects for the hotel, which was originally scheduled to open in June or July of next year.

“We’re pretty far along. Interstate Hotels Co. has agreed to operate (the hotel) as a Marriott Suites franchise, and just in the last couple of weeks we got a commitment” for $30.5 million in permanent financing from Chrysler Capital Realty Corp. of Greenwich, Conn., he said.

“We have all the pieces to the puzzle, and we have considerable (financial) resources within the partnership,” Wilson said.

Symphony Towers, designed by Skidmore, Owings & Merrill in Los Angeles, surrounds Symphony Hall and takes up the city block bordered by A and B streets and 7th and 8th avenues.

The developers have leased half the office space in the primary 34-story tower, which is scheduled to open in February, Wilson said.