CHICAGO — The trustee on $98 million of St. Louis convention center hotel bonds will host a telephone conference call for bondholders on Jan. 22 to provide an update on the hotels’ financial performance, a recent consultants’ report, and efforts of a local businessman to attract private investment.

Revenue generated by the hotel complex fell short of fully covering a $3.5 million interest payment owed Dec. 15 to holders of the senior-lien revenue bonds issued for the project, leaving the obligated group to cover $829,000.

A revised consultants’ report from C.H. Johnson Consulting Inc. also offers a gloomy prediction for the hotels’ future ability to cover debt service. The consultants now believe that if various upgrades are not made to the hotel complex, it won’t generate enough cash on its own to cover debt service until 2012.

Housing Horizons LLC, a majority member of the obligated group, has made loans to the group to cover shortfalls in the revenue on hand to make debt service payments in recent years, with the exception of the payment owed last June.

The St. Louis Industrial Development Authority issued the bonds in 2000 to finance the acquisition and renovation of the $266 million hotel complex to serve the city’s convention center. The hotels are operated by Marriott Corp.

The bonds initially garnered a low investment-grade rating from Moody’s Investors Service but fell deep into junk-bond territory as hotel revenues failed to meet initial projections amid a convention slump following the 2001 terrorist attacks.

Local businessman Steven Stogel has been working to attract private financing to restructure the outstanding bonds and local officials are working to increase convention center business and seeking funds to finance various improvements. Information on the call is available at UMB Bank NA Web site www.conventionhotelbondholders.com.


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