Loan Denial Halts Restoration Work on Old Mission Inn

Restoration of the historic Mission Inn in Riverside, where Theodore Roosevelt once stayed and Richard and Pat Nixon were married, was abruptly halted when financing ran out on the $40-million project begun three years ago, officials said.

Carley Capital Group halted work Friday at the inn after a loan needed to finish the job was denied by Chemical Bank of New York, said Maureen McAvey, Carley’s regional manager. She said it would be impossible to estimate how soon construction could resume if money is found to complete the restoration.

The inn, which was established about 55 miles east of Los Angeles in 1901, was to be renovated by Carley and operated by Omni Hotels. It had been scheduled to open Dec. 22.

Officials Stunned

“Frankly, we are stunned,” said Omni Vice President W. Robert McIntosh. “We have a lot of problems because of it.” A 35-member Omni management team was preparing to begin training 120 new employees next week, McIntosh said.

James Carley said work was stopped because his Madison, Wis.-based firm and Chemical Bank weren’t willing to commit an additional $3 million to the project.

Aside from the money needed to complete work, McAvey estimated Carley is facing between $4 million to $8 million in unpaid bills stemming from the project.

Chemical Bank has loaned Carley Capital $27.3 million for work on the inn, and McAvey said the inn might be sold to Chemical Bank to settle the debt.

City and federal grants totaling $2.7 million were still available for use by Carley, but were insufficient to complete the job, McAvey said.

Carley Capital obtained title to the Mission Inn on March 28, 1986, almost two years after successfully bidding to buy the troubled hotel from the Riverside Redevelopment Agency.

The cost of restoring the inn was initially placed at $13 million.

But once construction began, workers found that the structure was far more unsound and dilapidated than originally thought, raising renovation costs.

By March, 1986, a revised estimate for the renovation was set at $38 million. Five months later the estimate was increased to $40 million.