Promises to Hire Back Furloughed Workers, Plans to Build a $20 million Casino. Resort’s new owner hopes to build a $20 million casino and hire up to 600 new workers by the end of this year.
Jim Justice, who purchased the historic resort last week, said Monday that the resort would offer “tasteful gaming, but in an aggressive way.”
Justice also plans to start hiring back Greenbrier employees who were furloughed in January by the end of the week.
The Greenbrier now has 1,280 workers, but Justice plans to have 1,600 to 2,000 on staff by December, he said Monday.
“We’re going to have to spend some money to get this place in a position to make money,” said Justice, who bought the resort last week for $20 million. “We’re going to make this hotel flawless. It’s going to be first-class beyond belief.”
A May 19 court hearing has been scheduled in Richmond, Va., to consider Justice’s request to dismiss The Greenbrier from Chapter 11 bankruptcy.
There’s still a possible hitch in Justice’s plans.
Hours after Justice announced he purchased the hotel last week, Marriott International said it still had a “purchase agreement” to buy The Greenbrier from Jacksonville, Fla.-based CSX Corp. Marriott said it planned to honor its contract.
In a bankruptcy court filing last Friday, Justice’s lawyers noted that CSX had the right to sell the White Sulphur Springs resort to Justice — despite the previous deal with Marriott — provided Justice pays a $2.6 million “break-up fee” to Marriott, according to a termination clause. Justice said he plans to pay the fee — and move on.
“I hope this all gets worked out,” Justice said. “I don’t want a confrontation with the Marriott. [The resort’s employees] don’t deserve more of a cloud, more uncertainty.”
Marriott’s lawyers have yet to respond to Justice’s request to dismiss the case from U.S. Bankruptcy Court. A Marriott spokesman declined Monday to comment on what specific steps the company may take.
“We’ve seen the court filings, are reviewing the documents, and will respond in court at the appropriate time,” said Thomas Marder, Marriott’s vice president of global corporate relations.
Justice reiterated Monday that he owns The Greenbrier.
“CSX had the right to sell the property to me,” Justice said. “I purchased it. I paid for it. I have the stock.”
In November, Greenbrier County voters narrowly approved a measure to allow casino-style gambling at the luxury resort. Last week, Gov. Joe Manchin signed legislation that allows The Greenbrier to set aside a portion of casino wagers to help recoup the cost of employee benefits.
Justice estimated that the new law will allow The Greenbrier to pump up to $5 million more annually into employee benefits.
Justice expects to have an architectural drawing of the casino by June. The new facility, which would cost between $15 million and $20 million, could be completed by December, he said.
“I hope with a full blitz, we’ll get it done,” Justice said. “You’re going to have a whole lot of construction jobs.”
In January, The Greenbrier furloughed nearly half of its 1,350 employees. The resort was struggling to fill its 720 rooms amid the recession.
All but 70 of those workers have returned. Justice promised to hire back the remaining furloughed workers quickly.
“We’re going to be significantly calling people back by the end of the week,” Justice said.
Justice believes The Greenbrier’s bankruptcy filing jeopardizes the resort’s ability to remain competitive in the luxury resort industry, according to his company’s request to have the bankruptcy dismissed. The “stigma of bankruptcy” inevitably drives away guests and undermines The Greenbrier’s ability to book conferences, which generate a substantial portion of the resort’s business, the filing states.
Justice’s request to end the bankruptcy includes new information about his purchase of the resort.
Justice started talking with CSX in late April and purchased The Greenbrier’s stock May 6.
Under the agreement, Justice promised to operate The Greenbrier for at least two years “at standards consistent with maintaining a AAA Five Diamond rating.”
The Greenbrier has held the American Automobile Association’s five-diamond rating for 33 years. AAA awarded its top rating to 103 U.S. hotels last year.
“People forget how wonderful steward [of the resort] CSX has been for a long time,” Justice said. “They wanted a guarantee from me to carry on the tradition.”
In an interview Monday, Justice said he would also work with resort employees to improve The Greenbrier’s four-star Mobil Travel Guide rating. The resort lost its five-star Mobil status in 2000.
“I want to bring The Greenbrier back to where it was a long time ago,” Justice said. “I want it to be profitable. I can’t possibly let it fail.”
Justice scoffed at critics who question his ability to operate a resort.
The former coal company executive acknowledged he has never owned or managed a hotel. But he said he has a master’s in business administration and extensive experience in marketing and advertising.
He vowed to prove his critics wrong.
“I have the resources behind me, and the love of the people who work there,” Justice said. “I’ll set this place on fire. You wait and see.”