SUBSTITUTE RESOLUTION NO. RS2006-1140A resolution consenting to the assignment of the Amended and Restated Lease for the Renaissance Nashville Hotel from RHOC Nashville Hotel, LLC (f/k/a CTF Nashville Hotel, LLC) to HH Nashville, LLC, a Delaware limited liability company, an indirect wholly-owned subsidiary of Highland Hospitality Corporation, and accepting the sum of $2,342,000, less 20% of the closing costs, for the Landlord's participation in the profits of the transfer.
Whereas, by passage of Ordinance No. 089-1048 on December 19, 1989, the Metropolitan Council approved the Amended and Restated Lease between The Metropolitan Government of Nashville and Davidson County and Holdings of Nashville, Inc., as Tenant, (the "Lease") for operation of the Renaissance Hotel; and,
Whereas, under the Lease, the Metropolitan Government, as the landlord, is the owner of the real property and the adjacent Convention Center, while the Tenant owns the hotel structure and a third-party is to manage and operate the hotel; and,
Whereas, RHOC Nashville Hotel, LLC is the current Tenant and its member interests were purchased by an affiliate of Marriott International, Inc. ("Marriott") in 2005; and,
Whereas, a separate affiliate of Marriott, Renaissance Hotel Operating Company, LLC (the "Manager"), currently manages and operates the hotel and has performed those functions since 1997; and,
Whereas, representatives of Marriott have informed representatives of the Metropolitan Government that Marriott's business model does not normally include ownership of the hotels it manages, and that they intend to sell the ownership interest in the Renaissance Hotel; and,
Whereas, by proper notice with supporting documentation and financial statements dated December 7, 2005, and received on December 8, 2005 (the "Notice of Assignment"), Marriott formally requested the Metropolitan Government's consent to assignment of the Lease to a new Tenant, HH Nashville, LLC, a Delaware limited liability company, an indirect wholly-owned subsidiary of Highland Hospitality Corporation (the "Parent"); and,
Whereas, the current Manager will continue to operate the hotel under contract with an affiliate of the new Tenant; and,
Whereas, the Lease also provides that the Metropolitan Government receive a 20% share of the profit from the assignment and that share is $2,342,000, less 20% of the closing costs; and,
Whereas, the Metropolitan Government has examined the transaction, the anticipated profit and the financial capability and stability of the Parent and has concluded that the anticipated share is correct and that the Parent possesses the requisite financial capability and stability to assume the role of Tenant under the Lease through its indirect subsidiary, HH Nashville, LLC, a Delaware limited liability company.
Now, therefore, be it resolved by the Council of The Metropolitan Government of Nashville and Davidson County:
Section 1: That the Metropolitan Council hereby consents to the assignment of the Lease from RHOC Nashville Hotel, LLC, an affiliate of Marriott, to HH Nashville, LLC, a Delaware limited liability company, an indirect subsidiary of Highland Hospitality Corporation, as described in the Notice of Assignment; and that the Lease shall be considered as amended to reflect the new Tenant.
Section 2: That the sum of $2,342,000, less 20% of the closing costs, constituting the Landlord's share of the profit from the assignment, is hereby accepted.
Section 3: That this resolution shall take effect from and after its adoption, the welfare of The Metropolitan Government of Nashville and Davidson County requiring it.
Sponsored by: Amanda McClendon
|Referred:||Budget & Finance Committee|
|Introduced:||January 17, 2006|
|Deferred:||January 17, 2006|
|Deferred:||February 7, 2006|
|Substitute Introduced:||February 21, 2006|
|Adopted:||February 21, 2006|
|Approved:||February 22, 2006|