Struggling Rosario Resort looks to hotel experts, searches for cash

This week brought some early holiday cheer to Rosario Resort, the iconic vacation property on Orcas Island that has struggled since changing hands this spring.

Chris Robison, the 39-year-old real estate investor who paid $6.65 million for most of the resort in April, has brought in a seasoned hospitality management firm to help him reopen the resort’s historical Moran mansion this spring and, eventually, build new “5 star” guest rooms.

“I’m super excited to have them on board,” said Robison of the Utah-based Hartland Hotel Group, whose founders have refurbished and relaunched dozens of hotel projects and properties and, in the early 2000s, helped run Rosario itself.

Robison also insists he’s close on a new loan that would let him buy a remaining part of the resort, which includes most of the current guest rooms, cover unpaid bills and repay $4.6 million in loans that fell into default last month and put the resort on course for a trustee’s auction in February.

Oh, and the resort’s power, which was briefly shut off last month, reportedly over nonpayment, is back on.

To be clear, a lot of uncertainty remains. That includes the timing of the new financing and the willingness of the Barto family, which sold most of the resort to Robison in April, to part with the remaining bit.

More broadly, Robison and his new partners must solve the puzzle of the island’s tourism economy, which hammers businesses with scarce labor, erratic ferry service and a brutally short summer season.

But if things play out, it would represent something of a comeback for Robison and his resort, a 115-year-old property that was only partly open this summer and received atrocious guest reviews over lack of amenities and patchy service.

In theory, some of those rough edges will be smoothed over by Hartland, which can fill in for Robison’s own lack of hospitality expertise.

Hartland founders Mark and Jack vanHartesvelt have ample experience running and developing hospitality businesses. These include such vintage properties as Liberty Hotel in Boston, the Hotel Figueroa in Los Angeles — and Rosario, which Mark helped manage.

In an interview Tuesday, Jack vanHartesvelt, 69, said current plans call for a May reopening of the resort mansion, an elegant Arts and Crafts-style building that was completed as the retirement home for former Seattle mayor and shipbuilder Robert Moran in 1909. (The property opened as a resort in 1960.)

The mansion won’t house guests — it would be prohibitively expensive to bring the historical architecture up to code — but instead will serve as a combination of museum and possible workspaces, said vanHartesvelt, whose firm is an equity partner in the project.

He said Rosario will try to extend the busy season onto the spring and fall “shoulders” by, for example, more heavily promoting the facility as a wedding venue.

The group also aims to lure back local customers by keeping the restaurant and other amenities open year-round.

As for the local labor shortage, vanHartesvelt said the resort plans to reopen the roughly 20 units of employee housing up the hill from the mansion, “where people can stay year-round affordably.”

The resort could also build an additional 60 units of employee housing under a county-approved master plan for the property, he said.

None of this is locked in, by any means.

Financing continues to be an issue for Robison, who was only able to afford part of the resort earlier this year and struggled to come up with financing for the remaining property, despite heavily pitching the project to investors. As of Tuesday, county records showed the resort’s second half taxes, due Oct. 31, are unpaid.

Robison insists a new financing deal that will resolve all those issues is imminent, but couldn’t say when the funds would become available. He hoped it would be in December.

Meanwhile, creditors holding Robison’s $4.6 million loans said they haven’t received any recent updates as to when he will repay the loans, which technically defaulted in July.

“We have not had anything presented to us, our attorneys or anyone regarding” repayment, said John Pugh, a Mercer Island businessman and one of three partners who made Robison the short-term “hard money” loans, in a call Tuesday.

In a statement last month, shortly after the Nov. 12 filing of notices of trustee’s sale with San Juan County, Pugh said he and his partners had given Robison several extensions to repay the loans, but that, “sadly, we are now pursuing this foreclosure process.”

Even with financing, a deal for the remaining part of the resort remains elusive.

Robison and vanHartesvelt said the two sides are negotiating. A Barto representative said the family “would be happy to consider any offer,” but intends to put the unsold rooms, which “can be operated independently from Rosario” as condos, back “on the market in the near future.”

Robison and vanHartesvelt say Rosario can function without those additional units, especially as Robison is allowed to add 80 guest units to the property he already owns.

But they said some of the resort’s land-use authorizations have expired and require new applications. The partners will also need additional financing for construction, and also will have to repay the new loan, which is a relatively short-term note — “a couple years,” said vanHartesvelt. All of that makes it hard to imagine them meeting their goal of breaking ground by the end of 2025.

On top of that, Robison will need to soothe the feelings of some islanders.

Many remain unhappy Robison hired only a few of the resort’s former staff — and still isn’t sure how many he will ultimately employ, vanHartesvelt said. They are also upset Robison has shared few details about his plans for the resort.

But both Robison and vanHartesvelt say they’ve been reluctant to make promises about how quickly they can turn around such a complicated property.

“This is a winner, and … we think we can help Chris get it done,” said vanHartesvelt, of his and his brother’s long experience in the hospitality business.

“And we’re knee-deep in the process and we’re optimistic. But one thing I’ve learned along the way is, don’t BS.”