Did Giannoulias Unload State Hotel for Too Little $$$? - NBC Chicago
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Did Giannoulias Unload State Hotel for Too Little $$$?



    The man who would be senator shrugs off critics who say the $6.5 million sale was a bad deal. (Published Monday, April 5, 2010)

    Alexi Giannoulias may have given Illinois a raw deal when he sold a downtown Springfield hotel last year -- and could have sullied his anti-corruption bona fides in the process.

    Acting in his capacity as state treasurer, Giannoulias auctioned the 316-room state-owned Abraham Lincoln hotel this past December and received $6.5 million from downstate developer Steve Horve, the Sun-Times reports.

    But according to a series of appraisals on the property taken between April 2008 and December 2009, the state sold the hotel at a loss. Real estate experts and critics are questioning why Giannoulias decided to sell the hotel at a time when global and real estate markets were in turmoil. IOW, he may have made a bad judgment call.

    "It doesn't make sense to me as a hotel appraiser that the state would allow the sale to go through at such a low price unless there was some other motivation to get rid of it. It may have been politically motivated, or it may have been some other reason that we don't know," said Hayden Harrison owner of Hospitality Valuation Group, a nationwide hotel appraisal firm based in Springfield, Mo. to the Sun-Times.

    See the Sun-Times for the full, financially questionable details.

    Whatever the motivations for selling the hotel, the guy who bought it knows he got a deal. Horve confirmed the recent $11.2 million appraisal figure and boasted about the deal he got.
    "I think if this thing was bid again [in a couple years], it's very, very unlikely I would have gotten it," Horve, who estimated that building a comparable hotel would cost $40 million, told the Sun-Times. “I couldn't build a Holiday Inn Express, 62 rooms, for $6.5 million.”

    And then there's the political blowback for Giannoulias: his campaign has made the sale of the hotel a selling point for his candidacy. The hotel was originally built by indicted political fund-raiser William Cellini -- he took out a big ol' loan from the state and never paid it back. Giannoulias' campaign has said that by selling the hotel, Giannoulias was striking a blow against state corruption.

    But don't take out word for it -- just take a look at how Giannoulias' campaign crowed about the sale on their web site last December.