By JEFFREY SAULTON, Staff Writer
02/15/07 - PARKERSBURG — After six hours of deliberations, a Wood County Circuit Court jury of nine women and three men decided the West Virginia Department of Transportation did not harm the business of the Parkersburg Holiday Inn.
Jurors Wednesday answered no to the question "Did the West Virginia Department of Transportation, Division of Highways, take any property owned by the respondent, Parkersburg Inn, Inc.?" and "Did the actions of the West Virginia Department of Transportation, Division of Highways, in designing and constructing a highway and interchange, proximately cause any reduction in the fair market value of real property and improvements thereon owned by the respondent, Parkersburg Inn, Inc.?"
Dave Ashley, general manager of the Parkersburg Holiday Inn, faxed a statement to the Parkersburg News and Sentinel, reacting to the verdict.
"We still contend, as do all businesses left on this dead end road, that the businesses, including the Holiday Inn, were devastated by the decision of the state to deny direct access to the new road. We are obviously dumfounded that the jury found there was no damage to this hotel caused by the road.
"We have had to cut the number of employees by half just to survive. We will continue to fight for justice in the courts."
In the trial, the hotel presented testimony showing that after Sept. 8, 2003, when Corridor D opened, business began to fall off with occupancy dropping from 70 percent in 2000 to a little more than 47 percent in 2005.
An accountant, David Tenney of Tenney, Bailey and Associates, said in 2005 the hotel ended the year with a negative $76,000 cash flow.
George Bailey, whose testimony was presented by way of an August deposition, stated the Parkersburg Holiday Inn was at the point in 2005 where fixed expenses were exceeding revenues.
Bailey, who was a partner in Tenney, Bailey and Associates, died in November. He said the hotel had cut costs where it could, including eliminating the annual salary of hotel owner Jim Weigle in 2004 and 2005, but it was not enough.
Bailey said updates to the hotel had been deferred in an effort to cut costs. Bailey stated he believed the lack of direct access from Corridor D was the reason for the declining financial health of the hotel.
Ashley said the hotel has cut staff from a high of 130 in 2003 to 69 currently. He said there are no more cuts to be made and stay within standards set by Holiday Inn.
Leah Chappell, attorney for the West Virginia Department of Transportation, said the problems faced by the hotel had nothing to do with access to Corridor D. She said the hotel was facing more competition from newer hotels and that nationally large full-service hotels such as the Parkersburg Holiday Inn were declining as customers began to move toward smaller limited-service facilities.
Chappell said the state was not under obligation to provide direct access from the highway to the hotel, but only reasonable access. Marvin Masters, attorney for Parkersburg Inn, Inc., said customers reported they found the new access from the Seventh Street exit confusing. Masters said the access provided from what he called a service road with a dead end violated the division’s access rules.
Appraisals for the hotel varied widely between two local appraisers and two done by firms hired by the state to appraise property.
Larry McDaniel testified he appraised the property in 2003 and set the value at $8.4 million. He said if the hotel were to close, the buildings would have to be razed at a cost of $800,000 to make the site marketable, because the hotel building would not be suitable for other uses. Randy Reed, who appraised the hotel for a local bank in 2002, set the fair market value at $8.2 million.
David Pope, an appraiser with Hotel and Club Associates, said the fair market value was $4,420,000, plus $510,000 for surplus property on the site. Stephen Gordon, a commercial property appraiser of John McCracken and Associates, set the fair market value at $4,356,800, plus $443,200 for excess real estate for $4,800,000. Masters questioned the validity of the reports noting the appraisers did not visit the properties they used for sales comparisons and they were not the same as the Parkersburg Holiday Inn. Chappell questioned McDaniel’s use of sales comparisons from the 1990s. He said he used those because later comparison reflected sales made from "stress and duress" after Sept.11, 2001.
Masters said the outcome was disappointing.
"Obviously my client, the Holiday Inn, is upset at the verdict," he said.
Masters said the basis for the post-trial motions will be technical objections to items in testimony.
Wood County Circuit Court Judge Jeffrey Reed set the motions for 9 a.m. April 12, with motions to be filed by March 9 and responses from the state to be filed by March 23. Responses to the state’s response are to be filed by March 30. Chappell was unavailable for comment Wednesday.
Posted with permission from The Parkersburg News & Sentinel
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