“Honey, I think we are going to be short on our mortgage payment by $165,858.”
– Imagined dinner conversation of Bob Lowe, chairman and chief executive of Lowe Enterprises, The Terrenea Resort’s principal owner.
Gosh, maybe they’ll let it slide? …Turns out they just might! As always, it’s great to be rich. And it’s even greater to be uber rich. Check out this quote from the L.A. Times:
“Lenders are loath to take these properties back, especially something as management-intensive as hotels,” Reay said. “Foreclosure is the last resort on a resort hotel.”
So I guess the lesson here is…
…. wait there is no lesson here. It’s just lame. And so is the Terranea resort, in this writer’s ever so humble opinion. Every time I drive by I wonder, ‘Who the heck would come here?’ Also, how are they going to get here, the 110 South to Gaffey and through San Pedro? Wow, that route is going to make folks feel special – that is if they are into driving through poverty and gangland to arrive at Disneyland-style largess in the middle of nowhere. To me, it’s about as attractive as a long weekend in Haiti. Just stay inside the compound and you’ll have a lovely time.
Anyhoo, time for some fun math!
The Terranea Resort was built for a jaw-dropping $480-million. (Brief pause here so you, dear reader, may swallow the little bit of vomit that just bubbled up your throat). So since everything else around is here down by 20-33 %, where does that put the value of Terranea? Well, take the land value and add the replacement construction cost and factor in the 50% drop in tourism of late and factor in the pledged millions of tax dollars…now calculate that and arrive at: $%@!!!^@!!
In layman’s terms, that basically equals whatever the heck Donald Trump is willing to pay for it.
Why that’s ridiculous, we are just snazzy!
Again, from the LA Times article:
The hotel is 100% booked for Saturday night, and as many as 200 rooms have been rented on weekdays, Lowe said. Three weddings will be celebrated at Terranea this weekend.
My bad. Silly me. Here I was thinking all these negative thoughts without noting the resort was full on Saturday. I guess having 100% occupancy on the busiest hotel night of the week must be the yardstick for success in that industry. Don’t get me wrong, 3 weddings is great. But unless they can charge $60K a piece it’s still going to be tough to make those monthlies. (Actually, they probably CAN charge that much)!
My hidden agenda: The Terranea Website autoplays annoying music.
Recently my wife and I celebrated our 1-year wedding anniversary. (See adorable photos posted on this very Website). She was gunning for a couple nights at Terranea and I was modestly interested in making her dream a reality. So we get online and do the usually clicking around, and so on.
The cheapest ocean view room is $360/night. That means, of course, a 2 night stay is going to set you back a cool grand – and that’s assuming you don’t pickup the phone or even look at the minibar.
So I’m soon contemplating that expense as a percentage of my yearly income. And suddenly this ‘little local getaway weekend’ is anything but.
‘Gosh, that’s a ton of money,’ I think. ’Or maybe not. Maybe I’m just really poor.’
But then again, consider the average income of Americans …. once again, I’m back to, ‘Gosh that’s expensive.’
I start to think about other uses for that money. How could I make the money / the stay / the fun stretch? Is there somewhere we could fly, visit and stay for 3x as long for the same amount?
Then it occurs to me. And I’m soon Google-ing: “Travel deals to Haiti.’
For more information on the Terranea Resort please contact someone who cares. But for an unorthodox, dry and generally funny (but sometimes annoying) take on Real Estate in Palos Verdes Peninsula call me right away! I’m at 310-809-0203. And for goodness sake, subscribe to the blog already.