Portopia names potential Hyatt buyer

Hyatt Regency Saipan operator Saipan Portopia Hotel Corp. has identified a possible buyer of the Hyatt and has asked the Department of Public Lands to approve the reassignment of the hotel property lease to the interested buyer.

Earlier this month, Rep. Julie Marie Ogo (Ind-Rota) and Rep. Angelo Camacho (Ind-Saipan) wrote to DPL Secretary Teresita Santos asking for clarification regarding the status of the former Hyatt Regency Saipan hotel lease.

One of the clarifications sought by the lawmakers was whether interested buyers have reached out to DPL regarding the lease.

In a letter from Santos, she said DPL has not engaged in any negotiations with interested buyers; rather all interested buyers that have contacted DPL were referred to Portopia and all negotiations with those interested buyers have been handled by Portopia.

Last month, she added, Portopia asked DPL to approve an assignment of the lease to the assignee selected by Portopia, MB Capital LLC.

“On July 18, 2024, Portopia asked DPL to approve an assignment of the lease to Mr. David Hood and MB Capital LLC. DPL is now in communication with the assignee selected by Portopia. DPL has not yet confirmed whether the assignee meets the eligibility requirements and qualifying factors and has not yet approved the requested assignment,” said Santos.

Hood of MB Capital LLC arrived on Saipan in 2013. He has business experience in the U.S. mainland and on Saipan including 35 years developing residential and commercial projects. DPL adds that Hood estimates that his largest company, Coldwell Solar, is valued at over $200 million.

Hood intends to self-fund the required renovation of the hotel, estimated at approximately $30 million.

He also proposes to staff hotel operations by hiring a general manager with local hotel experience and by rehiring former employees of the Hyatt.

MB Capital LLC’s vision for the hotel is to maximize tourism as well as cater to local businesses and the local experience with the goal of reestablishing a connection with local markets and the community.

The former Hyatt Regency Saipan hotel property is encumbered by Lease Agreement LA22-001S dated Jan. 1, 2022 entered into between DPL and Saipan Portopia Hotel Corporation dba Hyatt Regency Saipan.

Pursuant to Article 3 of the lease, the term of the lease is for a period of 40 years, and an extension of up to 15 years may be granted with the approval of the Legislature pursuant to Article 4.

DPL learned that Portopia intends to stop operating all equipment and utilities and otherwise cease all activities on Aug. 31.

However, Portopia cannot unilaterally terminate the lease as of this date. This is because DPL will either need to declare a default of the lease under Articles 26 and 27 of the lease agreement once the premises has been abandoned for 90 days, or will need to execute a mutual cancellation agreement with Portopia to allow DPL to take possession of the Premises sooner.

DPL is not currently in possession of the leased premises and has no ability to lease or sublease the premises to other parties, as the leased premises are still under lease to Portopia.

DPL’s current role is limited to reviewing requests from Portopia to approve proposed lease actions, including possible assignment of the lease.