There may be a buyer for Galveston’s Flagship Hotel, reports Laura Elder in the Galveston County Daily News. The hotel suffered about $7 million in damage from Hurricane Ike last year. But Landry’s Restaurants, the current owner, has a fallback plan in case the sale doesn’t go through:
If the 225-room property at 25th Street and Seawall Boulevard doesnâ€™t sell, Landryâ€™s likely would demolish the hotel and develop a â€œpleasure pierâ€ with amusement rides, officials say. . . .
Landryâ€™s is pricing demolition for the hotel, built in 1965 as a show of confidence after Hurricane Carla, Jeff Cantwell, senior vice president for development, said.
Perched on a pier overlooking the Gulf, the Flagship fell into disrepair on its own after 1990, when The Flagship Hotel Ltd. took over management.
Landryâ€™s paid the city $500,000 for the hotel in 2004, saying it planned to spend $15 million transforming the property into an entertainment plaza with amusement rides, including a roller coaster.
Landryâ€™s attempted to move ahead, but was stymied by agreements that gave Daniel Yeh, head of The Flagship Hotel Ltd., control of the hotel until 2031.
Landry’s succeeded in wresting the lease agreement from Yeh — but only after a legal tussle last year that had the two parties switching sides. After Hurricane Ike, Landry’s wanted Yeh’s management company to hold onto its lease, but Yeh wanted out.
Yeh, who suffered a brain tumor and was declared at one point incompetent to stand trial, is now serving a 30-month sentence in federal prison. He pled guilty in 2007 to defrauding FEMA’s Short Term Housing Program after Hurricanes Katrina and Rita.
- Landryâ€™s considers selling Flagship, Ike stands long Flagship fight on its head, Flagship owner sentenced in FEMA scam, Flagship owner pleads guilty in FEMA trial, This â€˜justiceâ€™ is not fit to stand a trial, Flagship operator not competent for trial, Judge rules Yeh not competent to stand trial, and Landry’s could take Flagship helm in 2009 [Galveston County Daily News]
Photos: Ellen Yeates