Malone-based business group to take over amid hotel market challenges
By James M. Odato
Five Malone-area partners, including the family behind Titus Mountain Ski Area, have acquired Saranac Lake’s newest hotel, the four-year-old Saranac Waterfront Lodge.
Branch Hospitality Group purchased the 93-room hotel along Lake Flower from Champlain National Bank, which took possession of the property in recent weeks to avoid foreclosure, the hotel group said Friday.
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The new owners hope to strengthen the lodge’s stake in the region’s competitive hotel market through new marketing and pricing strategies, a Branch leader said.
Branch principals are brothers Brian, Christopher and Bruce Monette Jr., who own Titus, the Malone downhill skiing center they purchased in 2011.
The family has deep business roots in Malone, owning Adirondack Energy, Mo’s Restaurant, Mountain Mart and Adirondack Power Sports, a Polaris snowmobile franchise. The Monettes also own Holiday Inn Express hotels in Malone and in Oswego, each with 81 rooms.
Others involved in Branch Hospitality are Chris LaBarge, who operates a property and casualty insurance business in Malone, Amsterdam and Plattsburgh, and attorney Nathan A. Race, who is a co-owner of the Monettes’ two Holiday Inns.
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Michael T. Doran, president of Branch, said the lodge deal came together after Champlain National took over the deed in lieu of foreclosure.
The bank had committed $13 million to the lodge project. Champlain National President Steven Cacchio called the sale to Branch a positive for all involved.
Other New York banks financing the lodge were Evans Bank in Williamsville and Cattaraugus County Bank in Little Valley.
Public funds involved
Besides the private funds, the hotel was built with public assistance.
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The owners, Saranac Lake Resort Owner LLC, received $11.5 million in public money through an investment by the NY Green Bank, a division of the New York State Energy Research and Development Authority. Green Bank has declined to name the individuals in the ownership group.
The lodge is described as the Adirondack Park’s sole LEED-certified hotel. Leadership in Energy and Environmental Design structures meet high energy efficiency standards.
Also, Empire State Development awarded the project a $2 million grant. Only half of that sum was provided because the lodge did not meet a goal of employing 71 people by January 2023. Doran had no current workforce numbers.
A NYSERDA representative said Friday that the Green Bank took a $13.5 million loss on its investment of public funds in the Waterfront lodge’s ownership group, terming it “a downward valuation adjustment.” The Green Bank’s business plan, the representative said, ” includes expected losses” and the bank’s rate of losses is below comparable investment fund losses.
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“All the financial institutions involved believe this is the optimal resolution,” Cacchio said.
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Plans for the hotel
Doran said he is unsure why Branch won its offer over others and declined to provide details of the transaction.
“Where we stood on the top was our locality, what we represent, and what we have done with our other properties,” he said.
The group intends to combine skiing and hotel packages, highlighting the family-friendly aspect of Titus. They also hope to package the lodge with Malone Golf Club, a private, 36-hole course. Both properties are about 45 minutes from Saranac Lake.
“Plans right now are evolving,” Doran said. “It’s a turnkey facility. Great staff in place.” He said Branch’s hotel management company will be taking over from HEI Hospitality’s management after the planned Aug. 1 closing.
Doran said the group thinks the lodge can be profitable despite it being part of an Essex County market that appears to be oversupplied with hotel beds and with average monthly occupancy rates below 40% in recent months.
“There’s a place for everybody in that 40 percent,” he said. “There’s no really huge concern.” Branch will try to reposition the property with flexible pricing, promoting the hotel as a family destination.
The lodge has some strong marketing points, being close to hiking, near colleges and about 200 feet from the Adirondack Rail Trail, Doran said.
“We are fully committed to helping the area grow and prosper to its utmost potential,” Brian Monette said in a statement. “We are grateful to serve as the stewards of the exquisite Saranac Waterfront Lodge and we do not take this responsibility lightly.”