“Hi, do you want to buy a Ritz-Carlton in Dearborn, Michigan?” When veteran hotel broker John Jameson posed that question to prospective buyers this spring on behalf of seller Host Hotels & Resorts, the response he received over and over again was “no”.
The reaction hardly came as a surprise. After all, Detroit has one of the highest unemployment rates in the nation (14.3% as of June) following several years of massive job cuts in the U.S. auto industry. And the Ritz-Carlton Dearborn was financially underperforming by any measure.
“You know how many times I was hung up on?” recalls Jameson, managing director of the Chicago office of real estate services firm Molinaro Koger. Bargain hunters were candid about their dilemma. “Everyone is looking for a turnaround opportunity,” they told Jameson. 'But oh my god, will my investors kill me if I go to Dearborn.”
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