The story of Perry’s landmark hotel continues to unfold like a fairy tale. In a mere six weeks, since July 31, the century-old business has gone from abrupt, almost fly-by-night abandonment to purchase by a St. Louis marketing magician with the charm of a prince and his wife, who shares his family-centered vision for the Pattee and for Perry.
Jay and Denise Hartz of St. Louis have reportedly signed a purchase agreement with the Raccoon Valley Bank in Perry. If the sale closes in about 30 days, the Hartzes should take possession in late October.
"This is just what Roberta always wanted," said Perry Mayor Jay Pattee, referring to Roberta Green Ahmanson, Perry native and wife of California banking heir Howard F. Ahmanson, Jr., who spent lavishly on the hotel and Perry’s downtown in the mid-1990s. "She always hoped the community would step up and take possession of its historic icon," Pattee said. By all appearances the community has done just that, bankrolling the Hartzes’ dream to the tune of more than $500,000 and making an early-November reopening look likely. "I little expected such an overwhelming show of community support for this project," Pattee said. "People are putting their money where their mouth is."
The Hartzes first pitched their business model to potential Perry investors on Aug. 24, outlining their plan to live in Perry, owning and operating the hotel and marketing it much more aggressively to bike tourists, conference planners and the like. Jay Hartz has a 20-year background in turning around failing hotels, and Denise works in finance.
But the Hartzes road to the hotel has had bumps, and the dream seemed apt to fade a year ago, when they first explored the possibility of buying it, according to Pattee. The asking price then was $2.1 million, well beyond the Hartzes range, but when the hotel fell vacant this summer, Pattee called the Hartzes. Their enthusiasm and expertise had impressed him the year before, he said, and he thought they would be a perfect fit.
"They have a marvelous marketing plan," Pattee said, "and their living here in Perry ensures continuity for the hotel, which is of immense value for Perry’s economic development."
Arranging the local financing was largely the work of people like Dan Spellman, a tireless advocate for the hotel and the Hartzes’ plans for it. The veteran Perry attorney, whose family has practiced law here for decades, helped spearhead what he called the "ad hoc Save the Pattee Hotel task force." He said he assembled about a dozen friends who shared his concern for the town’s future and the hotel’s place in it, and they each reached out in turn to their friends.
"We wanted to resurrect the hotel and bring it back to life," Spellman said, "so we tried to identify and organize potential investors from the community. We brought together a real cross-section of the community."
Spellman’s pump priming worked. After listening to the Hartzes’ pitch, more than 50 local investors took a chance on the venture, buying $5,000 shares in the hotel or signing $25,000 promissory notes. This combination of equity and debt financing generated about $600,000 for the project, half again as much as the Hartzes hoped to raise in order to make an offer to the Raccoon Valley Bank.
Perry investors "were very excited about investing in the Hartz model," Spellman said. "Jay has a lot of experience in marketing—locally, regionally, nationally, even globally."
Spellman said four circumstances aligned to make the deal succeed: the excellence of the Hartz model, the loyalty of local investors, the "forward-looking, progressive leadership of the Raccoon Valley Bank" and the "progressive nature" of Perry’s city government.
"As mayor, I couldn’t be more pleased," Pattee said.
Bob and Carol Smith of rural Perry were among the supporters of the Hartz model and were happy to invest in Perry’s future. Carol has expertise in small-town economic development and said grassroots support for the new owners is crucial to the hotel’s and the town’s prosperity.
"The community base is a big part of the history of the hotel," she said. "We believe in it, and now it seems to be coming back, so we’re very hopeful."
Bob Smith agreed.
"The hotel’s such an important component in the local economy, and if it doesn’t work, we have a big hole in Perry’s economy," he said. "The Hartzes tremendous interest in living and working here makes a huge difference."
"They have the passion, the experience and the expertise to make the hotel successful," Spellman said. "We’re lucky to have them."
As for the Hartzes, they are living the dream even while not getting enough sleep.
"It feels like I haven’t slept in weeks," Jay Hartz said. "My mind keeps racing. It’s just been an amazing journey. The degree of community support has been overwhelming. It’s like a marriage made in heaven."