SAN DIEGO — Embattled Radisson Hotel developer Carroll Davis on Tuesday said that a possible $32-million offer for the posh Mission Valley hotel should prove to federal regulators that their investment in the hotel is protected.
A group of investors that may include San Diego Chargers owner Alex Spanos has reportedly offered to buy the Radisson for as much as $32 million.
Davis, ousted as operator of the Radisson in June, said that offer, if legitimate, "would clearly show that we have more than $10 million in equity above" claims by the Federal Savings & Loan Insurance Corp. (FSLIC), which is now owed $29 million in defaulted construction loans.
FSLIC officials--who, as the hotel's largest creditor, forced Davis out as operator--have urged the bankruptcy court to liquidate Davis' San Diego Diversified Properties, developer of the Radisson.
Regulators, who assumed the Radisson construction loans when they took over failed San Marino Savings & Loan, fear that Davis will not be able to reorganize his company from Chapter 11 bankruptcy and that their investment is in jeopardy.
Hearings into FSLIC's request will continue later this month.
Decline to Comment
Spanos has not been available to comment on the reported offer--for between $28 million and $32 million--and hotel officials decline to comment on the proposal.
Radisson bankruptcy trustee C. Hugh Friedman said only that "it's my responsibility to continue efforts to reorganize this operation by a desirable sale or other means."
Davis, responding Tuesday to a published report in The Times about the offer, said the reported offer is as much as $10 million more than FSLIC's contention that the hotel has a liquidation value of only $22.5 million.
"Therefore," Davis said, "our proposal for 'adequate protection' and guaranteed payments should stand as an equitable means of protecting not only the creditors but also the debtors' equity positions."
Davis said he has lined up a financial partner from New York--First United Fund Ltd.--that has become a 45% partner in San Diego Diversified Properties and is prepared to guarantee FSLIC "adequate protection" on its investment. That could amount to about $140,000 per month, First United Fund principal Mario Renda testified in court last month.