Meet another hotel backer
SARANAC LAKE – A Syracuse-based hotel and restaurant developer who owns a second home in Lake Placid is one of Chris LaBarge’s partners in his proposed Lake Flower hotel project.
“Chris knows that I have a passion for the area,” Jacob Wright, who’s in his mid 30s, told the Enterprise in a phone interview last week. “He showed me the project, it made sense for us, and I wanted to jump on board with it.”
Wright is the CEO of High Peaks Hospitality, which owns four hotels in the Syracuse area – three Holiday Inn Express hotels and a Maplewood Inn and Suites – and manages another two. Wright was one of LaBarge’s partners in developing the Holiday Inn Express in Malone.
Wright is also connected to a larger group of partners that owns hotels and restaurants in the Midwest. It’s currently building a 90-unit Country Inn and Suites in Sioux Falls, S.D., and a Quaker Steak & Lube restaurant in the same city. The company also owns Quaker Steak & Lubes in Syracuse, Rochester, Fargo, N.D., and Rapid City, S.D.
Wright said his partners are also principals in Hospitality Builders Inc., based in Aberdeen, S.D., which has built 500 hotels, motels and restaurants across the country since 1975. This is the company that would build the 90-room, four-story Lake Flower hotel, Wright said. It’s expected to cost $15 million to $18 million.
“It’s not a project that’s outside the scope of what we normally do to any huge degree,” Wright said. “I wouldn’t say it’s a stretch project by any stretch of the imagination. In Sioux Falls, we’re putting $14 million in the ground right now. It’s kind of what we do.”
Wright was named to the Business Journal of Central New York’s list of “40 under 40” entrepreneurs in 2010, when he was 32 years old. A graduate of SUNY?Oswego with certifications in hotel development and finance from Cornell University’s hotel school, Wright has also been a guest lecturer and entrepreneur in residence at Cornell.
While work keeps him in the Syracuse area, Wright said he and his family are in Lake Placid often. His kids are in the New York Ski Education Foundation.
“We’re skiing every weekend, for the holidays we’re always up, and through the summer time,” he said. “It seems like we’re spending as much time up there as in Syracuse.”
In addition to him and LaBarge, Wright said there are two other partners involved in the proposed Lake Flower hotel, but for now, the other two “will be more silent.”
Until Wright came forward, not much had been revealed publicly about who else, other than LaBarge, is behind the project and what kind of track records they have. The absence of those details sparked a series of probing questions at the last village planning board meeting.
“I feel I need a few more definite bits of information about the company, about the partners, about their expertise, about whether or not they’ve done something with a four-star resort and if they’re competent to run that kind of enterprise,” board member Patricia Hilling said. “It just seems to me that if you’re going into a project of this caliber, it’s important to know as much as you can know about the people who want to do the work.”
LaBarge had submitted a narrative about his credentials to the board, as he’s required to do under the village’s Planned Unit Development District law. At the meeting, he said he probably has “the least amount of experience” in hotel development among his partners.
“My partners, to a larger extent, one is in the hotel and motel and restaurant construction business, and over the last 35 years (they) have built more than 500 hotels, motels and restaurants,” LaBarge said. “The combined partnership has owned and operated in excess of 40 hotels. Currently the ownership team owns 16 or 17 hotels and about four restaurants. One of the partners is a construction management company, and one of the partners is a management firm that operates and runs the hotel.”
Other planning board members said they didn’t need any more information beyond what LaBarge provided. Board Chairwoman Leslie Karasin said there’s a line between “where something is a zoning issue and where something is a private enterprise business issue.”
Village Community Development Director Jeremy Evans said the PUDD law asks for information about a developer’s credentials, “but it doesn’t say what level.
“It leaves that up to the applicant,” he said. “I think that’s wise because it’s not appropriate to ask for proprietary information about the business.”
The biggest concern surrounding the proposed hotel has been its nearly 60-foot height. Wright said the building has to be four stories to work economically.
“If you don’t have enough units in the hotel during the peak seasons, essentially you can’t cash flow it,” he said. “With the amount of land, you’ve got to go vertical to a certain degree. It might be a property with a four-story building, but it’s going to be a beautiful four-story building that has a historical nature to it.”
Questions have also been raised about the company’s ability to run an upscale resort, as they’ve called it.
“What experience do they have with a four-diamond resort, because that is certainly much different than a Holiday Inn Express,” Cheryl Madden asked at the board’s last meeting. “When you need staff, you need a different level of staff. I’d also like to know what type of occupancy you’re expecting. My concern is the viable business going forward, so we’re not looking at a building that’s not running.”
LaBarge said a full feasibility study has been done, which he said was necessary to get financing for the project, but he said that’s private information that he isn’t willing to share.
“We’ve built some higher-end hotels, and we’ve run higher-end boutiques,” Wright said. “We have a lot of great industry connections of other partners that we have that run some very serious high-end hotels. We certainly have the connections to bring in the expertise needed to operate that.”
The project was awarded $2 million in state funding last week. Wright said that money is crucial to help offset some of the costs of infrastructure and development of the hotel.
He said the partners hope to get the necessary approvals from the village, the state Adirondack Park Agency and others over the winter, “so when the snow breaks, we can get to work on it.”