COMPTON : City Council Decides to Buy Troubled Hotel
The city moved a step closer to selling the troubled Compton Ramada Hotel when the City Council decided to purchase the hotel from the Community Redevelopment Agency.
The paper transaction will allow officials to place money from the sale in city coffers, rather than limiting the proceeds primarily to redevelopment projects.
Following a brief, sparsely attended public hearing last week, council members agreed unanimously to purchase the hotel for $5,037,743, which equals the amount the Redevelopment Agency borrowed from the city for upkeep of the hotel.
The city has been managing the hotel since beginning foreclosure proceedings more than two years ago against a delinquent developer who never made a payment on more than $5 million in city-backed loans. The 288-room hotel and attached convention center have suffered low occupancy rates and managerial upheavals since opening in 1989.
While the city previously estimated the hotel and convention center’s worth at $35 million to $40 million, most city officials say it’s doubtful they will be able to sell for that amount, due to a depressed real estate market.
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