LaSalle, Le Meridien Legal Teams Suit Up Again

Le Meridien has been the only operator in 22 years for the 407-room hotel component of the Plaza of the Americas in the Dallas CBD. In New Orleans, it has operated the 497-room Le Meridien on Canal Street since the mid-1980s.

Le Meridien was told to go in January, roughly six months after the London-based chain was bought by the Japanese banking giant, Nomura International. LaSalle says the ownership change altered the contract and effectively enabled the terminations. LaSalle Hotel Operating Partnership LP bought the New Orleans hotel in 1996 and Dallas in 1997.

In Dallas, LaSalle has fought its battle in district court and won with a May 13 ruling allowing the contract termination. Now, it's headed into a justice of the peace proceeding to push the eviction. A writ today could force an expeditious decision Monday and possibly eliminate further delays. Le Meridien has appealed to county court and wants a hearing delayed until November.

In New Orleans, LaSalle has to plead its case before an arbiter in a closed proceeding. That date is not being made public.

"It's not a question of if, it's a question of when," Michael Barnello, LaSalle's COO, tells GlobeSt.com. "We own the hotel. They have a lease with us. We want them out of our hotel. They're effectively squatters."

Rob White, a top exec at Le Meridien, did not return phone calls before press time. A Le Meridien partner did tell one newspaper that it has six years left on its Dallas lease and has no plans to make an early exit.

The unusual brouhaha is sure to continue well beyond the eviction. Barnello vows that LaSalle will seek compensatory damages for legal costs and delays for the repositioning of the properties. LaSalle intends to pump $3 million into each hotel as soon as Le Meridien is out the door.

The makeovers will add Westin's Heavenly Bed and Heavenly Bath amenities as part of a plan to bring the properties in line with LaSalle's expectations. Westin was selected, Barnello said, because LaSalle "liked where their brand is heading. It's a right fit for the quality and location of those hotels." Westin Hotels & Resorts is a brand of White Plains, NY-based Starwood Hotels & Resorts Worldwide Inc.