Heavy losses force Estrada pal to close down Davao hotel

DAVAO CITY – Heavy financial losses have forced plastics king and presidential friend William Gatchalian to close down Tuesday the Waterfront Insular Hotel Davao, considered to be among the landmarks in the city.

The closure, which according to the Wellex Group of Companies is only temporary, caught the almost 200 hotel personnel by surprise who were all worried about their being suddenly jobless.

Of the 200 hotels workers, who were barred from entering the sprawling premises of the 157-room hotel by the beach since Tuesday, at least 53 were reportedly asked to stay until Dec. 6 to provide services to the remaining guests.

The Waterfront Insular Hotel was the second big hotel to cease operations in Davao due to the problems brought about by the Mindanao crisis and the economic crunch the country is now experiencing.

The Malaysian proprietors of the Samal Casino Resort in the nearby Samal Island, closed the resort complex early last year after incurring heavy losses.

There were reports last year that the Gatchalians were even planning to buy Samal Casino Resort because of the casino facilities in the complex but reportedly failed to reach an agreement with the Malaysian owners of the resort.

"It appeared that the hotel was running on heavy losses wherein the operational costs were really higher than how much it was actually earning in terms of income from both the banquet functions and the rooms," reliable sources in the local hotel industry said.

Starting Tuesday, the hotel reportedly only accepted guests with prior room reservations while all its functions rooms, including the restaurants and the bar, were closed already.

"We have been refusing any walk-in guests and we have not been serving any food anymore. There are no more functions in our ballrooms," said a hotel employee who were among those who lost their jobs last Tuesday.

Efforts to get in touch with the hotel management proved futile as nobody would want to speak for and in behalf of those who are still with the skeletal force tasked to take charge of the daily operations of the hotel until Dec. 6

By Dec. 6, sources said, the hotel would completely cease operations after it has honored all the room reservations it has committed to serve.

The hotel, which was built by the Ayala Group of Companies in the early 1960s, was bought by the Gatchalians for P500 million late last year. The management of the hotel was formally turned over by the Ayalas to the Gatchalians last January.

Aside from the Davao Insular Hotel, the Gatchalians also acquired other hotels in Laoag, and in Cebu, forming the Waterfront chain of hotels.

Two of the major functions that President Estrada attended here in Davao City during his two latest trips here last month, were supposed to be held at the Waterfront Insular Hotel but a last minute change of venue took place wherein both functions were held instead at the Mercure Grand Hotel, owned also by another presidential friend Eddie Gaisano of Cebu.

No explanations on the change of venue were given by the organizers of both important events, the third meeting of the Mindanao Coordinating Council and the general meeting of the Mindanao Confederation of Governors and Mayors.

In both instances, the President also opted to stay overnight at the Grand Mercure Hotel instead of at the Waterfront.