Quote:
Originally Posted by EE-BO
It does not make sense that he would lose his contract on the property over property condition just because of this one incident. If the owners were really interested in extending his lease, one would have to presume that they- like any good business person- would not let an isolated incident like this ruin the deal.
There is more than meets the eye here- whether the property had other serious issues or the owners had other reasons for wanting to terminate the contract.
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Just like we have insurance for Risk Management purposes, any business needs to have insurance for its own Risk Management purposes. This may have been a one-time incident, but that incident can have a ripple effect. Any guests, especially families with small children staying at the hotel, would have likely complained about the noise and condition, the same goes for any guests whose cars got damaged. Even if Pike pays to have that fixed, the guests will want some kind of restitution and the hotel will be forced to pay them so as not to lose more customers. If damages were extensive and will take a while to repair, this could deter even more guests from staying there, resulting in a loss of business. Just like a chapter that perpetually hazes and has alcohol violations is a liability for us, a hotel that is unable to attract guests and therefore cover its expenses is a liability in the business world and I can see why its contract would not be renewed. So yes, $4.5 million is not a far-fetched figure.
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