Queen Mary’s longtime caretaker Evolution Hospitality will enter 5-year agreement to manage ship – Signal Tribune

Evolution Hospitality, the Queen Marys caretaker for the past year, will enter into a five-year management agreement with the City to get the ship reopened to the public.

I know many of the residents here are excited to see more activity and events come back to life in our Queen Mary, Councilmember Suely Saro said during a Tuesday council meeting. I know that we went through a very hard time with the Queen Mary.

The ship has a long history of failed operators, one of which defaulted on their loan and two of which filed for bankruptcythe most recent being Urban Commons via Eagle Hospitality in 2021.

Before, in the past 40 years, weve really tried to manage this asset by shifting all the requirements, all the responsibilities, but also all the benefits to a private company, City Manager Tom Modica said, noting that operators were often saddled with debt to obtain the lease in the first place. That proved really not to be a model that was successful.

Instead of continuing with the failed model, the City is sparking up a management agreement with Evolution Hospitality to manage the ship in exchange for a portion of the areas revenues.

The City retains significantly more responsibility for this asset [the Queen Mary], such as major capital improvements. But the City also is entitled to a majority of net profits generated at the site, said Johnny Vallejo, acting director of the Economic Development Department.

That means that the City is required to pay for larger capital improvements for restoration and preservation, of which there are plenty. A 2017 marine survey estimated a $289 million price tag for long-term repairs and maintenance of the historic ship.

Evolution will be responsible for maintaining the ship and will retain a historic resource advisor to assist them.

For the past decade, Evolution Hospitality has been the caretaker of core maintenance and security of the ship and surrounding area. The company is a subsidiary of Aimbridge Hospitality, one of the worlds largest hotel operators.

This is what almost anyone does who owns a hotel property. They then bring on someone whos a hotel expert and these are one of the best experts in the nation, Modica said. So they do it for a percent of the gross revenue [] If history is any indication, this property all made money for the hotel itself.

Under the five-year agreement, Evolution Hospitality will be responsible for the Queen Mary leasehold area, including the ship and adjacent parking. The company will operate the Queen Mary Hotel, attractions, retail, food and beverage, parking and ship-based special events.

The management agreement includes buffers for past misfortunes: additional auditing mechanisms, such as mandatory monthly financial reports, annual audited financial reports and proposed budgets for capital projects and expenditures.

During an investigation into the operation of the Queen Mary, former operator Urban Commons refused to hand over certain financial records, despite the Citys right to audit the financials of the company.

It is incredibly important that we have access to the operation fund to help manage that operation fund, to audit, we have access to that, Vice Mayor Rex Richarson said. The performance standards, I think are good, there is an incentive to do well.

The City will pay an estimated $2.87 million for pre-opening and reopening costs for the ship, paid by the Tidelands Area Fund Group and year-end budget savings.

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Queen Mary's longtime caretaker Evolution Hospitality will enter 5-year agreement to manage ship - Signal Tribune