Developer Leaked Hotel Deal During Spat With L.A. Port

In the heat of their spat with the Port of Los Angeles, officials at HCT Inc. purposefully let slip a port secret: the Radisson Hotel Corp. has agreed to operate a 350-room hotel at the port’s World Cruise Center.

HCT is negotiating with the port to build the hotel. However, both HCT and Radisson say those plans may fall through in the wake of the port’s decision to end negotiations with HCT for construction of an office tower in downtown San Pedro. The port has decided to build the tower itself, a move HCT says has jeopardized financing for the hotel project.

Cyril Chern, HCT vice president, said his company, as well as Radisson, consider the hotel and tower a package deal. At the suggestion of port officials, they had intended to link them when seeking financing because a hotel is a better risk with an office building that provides a built-in clientele, he said.

But Mark Richter, assistant director of property management for the port, said port officials “were always very careful, very cautious” not to link them. “They were two entirely separate and discrete projects.”

John Craddock, a senior vice president at Radisson, said he does not believe the hotel can obtain financing without the office tower. He said that his company is frustrated with delays by port officials and will back out of the hotel project if the Harbor Department and HCT still lack a development contract by Aug. 31.

“I haven’t seen a document from anybody or even an acknowledgement from anybody that this project exists,” Craddock complained. “So as far as I’m concerned, I don’t see a real deal here.”

According to HCT, the deal with Radisson was signed in October, 1987. In a press statement about the office tower project, HCT Chairman Jack Garfinkle disclosed the existence of the Radisson deal by complaining that port officials wanted it kept hush-hush.

“We are now forced to question the port’s motives requesting that we not disclose the name of the major hotel group we have obtained to operate the World Cruise Center’s hotel,” the statement quoted Garfinkle as saying. “Why would the port not want the public to know that the Radisson Hotel Corp.” had the contract?

Chern, the HCT vice president, suggested in an interview that port officials feared public knowledge of the Radisson deal would harm another San Pedro hotel project--a Sheraton now being built on 6th Street, near the proposed port office tower.