Investor in Troubled National City Hotel Seeks Control of Project
The developer and contractor working on a troubled National City hotel have been removed from the project by principal investor William Barkett, who told the City Council that disagreements and a large number of liens filed against the property are forcing him to take over the redevelopment project.
No work has been done on the Radisson Suites hotel--save for the steel frame and shell--for four months, as nervous city officials waited for Barkett, developer Jack Scull and contractor Christopher Boomis to pay the liens and resolve other differences that have arisen among the three. Scull is president of Serj Corp., and Boomis is president of Concrete Dynamics.
In telephone interviews Wednesday, Boomis and Scull confirmed that they are negotiating with Barkett to terminate their business relationship with him, but said they will continue on the project until an agreement is reached.
However, it appears that Barkett, who controls the purse strings for the project, has won out. On Tuesday night, he told the City Council that Scull’s Serj Corp. and Boomis’ Concrete Dynamics are out of the picture.
“Are we still dealing with Serj Corp.?” asked Councilman Michael Dalla.
His question prompted a terse “no” from Barkett.
“We’re having problems with the contractor,” said Barkett, who added he is in the process of finding a new contractor for the hotel.
However, a National City redevelopment agency official said Wednesday he is confused about Barkett’s claim that Scull and Boomis are being replaced and noted that the city’s contract for the project still belongs to Serj.
Concrete Dynamics was hired by Serj to do the construction.
“It must be remembered that Scull and Serj are the redevelopers,” said Dave Shelton, assistant director of the city’s redevelopment agency. “The master contract said Serj would do all four (street) corners. Serj is still the actor in that.”
In a brief telephone interview Wednesday, Scull insisted that he is still the project’s developer.
“Serj is still the redeveloper for the four corners and has a contract with the city to accomplish the project. Serj is still involved to ensure the project is completed,” said Scull.
As to Barkett’s claim that the city is no longer dealing with Serj, Scull said:
“He’s saying things that aren’t quite correct.”
“It does appear that an agreement is in the works, and, if an agreement is signed, what he said is true,” said Boomis. “We have agreed verbally to settle under certain terms and conditions. We don’t want to do anymore business with Mr. Barkett.”
Barkett assured council members that the 12-story, $18-million Radisson Suites hotel, at the corner of 8th Street and National City Boulevard, will be completed on schedule next spring.
A hotel across the street, the $12-million Radisson Inn--10 stories high with 180 rooms--was also built by Serj and Concrete Dynamics with investment money raised by Barkett. It opened last year. Both hotels are part of the city’s Four Corners redevelopment plan.
The three businessmen declined to reveal details of the negotiations, but Barkett spokeswoman Susan Gossling told reporters Wednesday night that he is “now the owner, financier and builder” of the Radisson Suites.
Gossling also confirmed persistent rumors that Kuwaiti money was used to build the Radisson Inn and Suites hotels. She declined to identify the Kuwaiti investors but said the crisis in the Middle East will not affect financing for the unfinished hotel.
According to Gossling, Barkett’s decision to sever his business relationship with Scull and Boomis was influenced in part by liens filed by unpaid subcontractors on the Radisson Inn and Suites projects.
The amount of the liens has been the subject of much controversy.
National City Councilman Jess E. Van De Venter estimated the total at more than $4 million in June. Earlier, Scull told The Times that the “legitimate liens” that he recognized totaled about $200,000. Other estimates have put the total at between $1 million and $3 million. Boomis filed a lien of $1.25 million against Barkett.
On Tuesday night, Barkett said, some liens have been settled and agreements are being reached on others. He added that most subcontractors who filed liens against the hotels will be rehired. He estimated the current “amount of legitimate liens” at $300,000 to $400,000.
Barkett complained that the lien problem was made to appear worse because some contractors filed them twice, once on the Suites and again on the Inn. Gossling added that some contractors filed liens for the amount of the contract, which is much higher, rather than for the work they performed that went unpaid.
“All this made the problem appear much worse than it was,” said Gossling.
Barkett assured council members that his dispute with Scull and Boomis will be settled within 30 days.
Meanwhile, Van De Venter informed Barkett of a new problem. He told him that the county has filed a delinquent property tax notice on one of the hotels for $22,000.
Barkett, who was at a podium addressing the council, sighed and promised to take care of it.
