Given that Otto’s membership synopsis in my last Cold Wars AAR (for 2016) may have presented some unintentional inaccuracies or at least reporting bias, I have received a statement from HMGS about the current state of the Lancaster Host, HMGS’s business dealings with the Host, and what the HMGS BoD expects to be their way forward in event that the Host cannot fulfill their contracts. Here it is in full.
This is an update to the Lancaster Host Resort and Conference Center (the “Host”) auction and ensuing proceedings. This is the same information that Scott Landis briefed to the attendees at the Friday night Cold Wars membership meeting and is provided for those of you who were unable to attend. (edit: I was not there — Walt)
What we know:
After the auction ended with no buyers meeting the minimum sale price, several potential buyers have continued to negotiate with the Host owners over the last few months. Two of these are nationally known hotel chains who plan to keep the Host in operation as a hotel. They have been examining the Host financial records and inspecting the building facilities. Some of the more observant of you may have noticed one such group over the weekend at Cold Wars.
We have been informed by Host management that the potential buyers all plan to renovate the building piecemeal starting with the HVAC and other essential internal systems. Rooms will also be updated and modernized. If this occurs, we will lose a percentage of rooms as the room upgrade will occur in phases. However, we are not filling the hotel now as many attendees stay elsewhere due to the conditions at the Host. The Host has essentially waived the room night requirement since many of their rooms are not usable. (Edit: This matches observations by Jim McWee, who observed that some of the rooms at the far end of the Host appeared cannibalized, with no door locks and broken windows. — Walt) Host management believes the sale will take place within the next two months. For HMGS, the timing is very important since we would need ample time to plan Fall-In!, whether it is at the Host or elsewhere. Should a buyer sink considerable capital into the Host the new owner may also elect to not honor the existing contracts as part of the terms of sale. We expect them to want to renegotiate our contracts to recoup some of their expenses.
At this point, the Host has not cancelled any future contracts, so Fall-In! 2016 and Cold Wars 2017 will go on as planned unless the Host or the new management cancels our existing contracts or cannot provide a usable facility. As you know, HMGS, Inc. cannot initiate a cancellation of either convention without incurring a substantial monetary penalty. We found alternate venues for Cold Wars 2016 and had cost feasible proposals in hand in December. We were prepared to move Cold Wars 2016 if necessary.
The Board has decided to pursue an alternate site for Fall-In! 2017 with proposals due for review at Historicon this summer. By then, we expect the Host’s future to be known and any work that has gone into considering alternate sites will expedite selection of a site for Cold Wars 17 and Fall-In! 16 should it be necessary.
Our goal is to continue to run our conventions, whether at the Host, or another location. Event and vendor registration is open for Historicon 2016. We will continue to update to membership as soon as any new relevant information is received.
I’ve heard much discussion about the future of the Host at Cold Wars. Apparently there is a significant requirement for meeting space for smaller conventions (of which HMGS is just one of several) in the Lancaster area. To give you an idea, concurrent with the Cold Wars 2016 convention was a quilting convention being held at several motels up and down the 30 corridor. The quilting convention was using meeting rooms at the Continental and other hotels further down Route 30. Clearly, the developers interested in the Host as a property see this as a business need they could make profitable. That’s good, but I’m not comfortable helping to pay a huge cost increase to help cover the renovations– they might raise the rates somewhat but only so far– the entire reason there is a need for smaller low-cost meeting space is that it is, by definition, low-cost. As one of the Host’s most reliable and faithful customers for the last 2 decades, I think we should have more bargaining power than this.