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Turism&Travel : Olympic floating hotel venture is at risk of sinking

Monday 01 February 2010

Newwest Special Projects, the Edmonton travel company behind the plan, is scrambling to work out a deal with its partners to lower costs and keep the venture afloat.

The Norwegian Star is scheduled to sail out of Los Angeles later this week, headed for a dock in North Vancouver to serve as a floating hotel for as many as 2,200 guests.

But it appears not enough guests have booked rooms, even after the company cut prices by half in September and then cut them even further in January, to as low as $275 per room, including three meals a day.

After the company's marketing arm was contacted by CBC News over the weekend, it issued this statement:

"Our sales have not been what we had hoped for and our expenses have increased beyond what we ever expected. We are negotiating with all of the parties involved with this project throughout the weekend to try to lower costs and seek some concessions. We are making every effort to continue with our charter as planned."

Expenses mounting Industry insiders told CBC News the company likely paid $12 million to $15 million to charter the ship, and then had to set up an expensive makeshift cruise ship terminal on an industrial dock to meet stringent Olympic security requirements. The ship's 1,000 crew members also needed Canadian work visas, an estimated $200,000 expense.

One of Newwest's Alberta investors, Abe Neufeld, said negotiations are "tense" and that it's a "tough struggle," but he remains hopeful the project will go ahead.

When asked if any of the Olympic visitors can expect to get their money back if the project sinks, Neufeld said they would be "looked after," but did not elaborate.

Tourism Vancouver vice-president Walt Judas said that if the deal falls through, there is accommodation available in downtown Vancouver, but prices are expensive and most hotels only have one- or two-night gaps in their reservations.

More accommodation is available around the Metro Vancouver region in motels and hotels, at bed and breakfasts and in private homes, said Judas.

Autor: eTurboNews
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