Luxury resort opening in depressed Rhode Island

Between the private beach and butler service, a new resort on Rhode Island's shore promises to be among New England's most luxurious when it opens in June.

The original Ocean House was a post-Civil War resort destination for the rich. The 1916 silent movie "American Aristocracy" with Douglas Fairbanks was filmed at the towering Victorian hotel, known for its yellow facade and striking ocean views. But the 135-year old hotel, in need of extensive repairs and upgrades, was closed in 2003 and razed.

Now a group of sentimentally attached investors — led by mutual fund magnate Charles Royce — is taking a $140 million gamble, building an upscale replica of the hotel in the seaside enclave of Watch Hill. They want the new Ocean House — with its 49 rooms and 23 condos — to compete with rival destinations in places like Newport, Nantucket and the Hamptons.

Royce, who owns a summer home in Watch Hill, said he was dismayed by the prospect of losing the hotel, where guests, socialites and local residents converged for grand celebrations or simply drinks at the bar.

He bought the property from a developer who planned to build large homes on the site.
"The world doesn't need more McMansions, especially in (place of) something that was such an important part of the community," Royce said. "The sole purpose was to make certain that this very important community asset could be preserved."

Royce, founder and president of the Royce Funds, assembled about a dozen investors with ties to Watch Hill. The investors received a short-term $60 million construction loan and expect to repay it by the time the project opens, and say the balance is their own money.

Of course it's a risky time to open a luxury boutique hotel with $600-a-night rooms, especially in Rhode Island. The state has among the highest unemployment and foreclosure rates in the country. The local economy has been hammered by the credit crisis and vanishing manufacturing jobs. Ocean House will also be competing for visitors against East Coast destinations with instant name recognition.

Nationally, room occupancy at luxury hotels is forecast to fall to 61 percent this year, down from about 68 percent last year, with the average daily room rate sliding to $240 from $289, according to estimates from PKF Hospitality Research.

Northwest pilots appeal license revocation

The Northwest Airlines pilots who overshot Minneapolis by 150 miles are appealing their license revocations with the National Transportation Safety Board.

The appeals were filed late Wednesday, said board spokesman Ted Lopatkiewicz. He said that appeals typically are heard by an administrative law judge with the board within 120 days.
The Federal Aviation Administration revoked the licenses of Capt. Timothy Cheney of Gig Harbor, Wash., and First Officer Richard Cole of Salem, Ore., last week. The agency said the pilots put the 144 passengers of Northwest Flight 188 in serious danger on Oct. 21 when they failed to communicate with anyone on the ground for 91 minutes despite repeated attempts by air traffic controllers and their own airline to reach them.

Cheney and Cole told investigators they lost track of time and place while working on crew scheduling on their laptops. They said they didn't realize their situation until a flight attendant contacted them on the intercom to ask when the plane would be landing. By then, the Airbus A320 was over Wisconsin at 37,000 feet. The pilots turned the plane around and landed safely in Minneapolis.

Attorneys for the pilots declined to comment.

The incident raised national security concerns. Senior White House officials were notified by the White House situation room during the incident. Fighter jets in two locations were moments away from taking off to track down the errant airliner when contact was re-established.

FAA and NTSB investigators were in Colorado Wednesday, where they interviewed controllers at FAA's en route center in Longmont. FAA investigators also spoke with military officials at the North American Aerospace Defense Command, spokeswoman Laura Brown said.

The U.S. military would have launched fighters if it had been notified sooner. Gen. Gene Renuart, who heads U.S. Northern Command, has said he learned of the incident just four or five minutes before FAA regained contact with the pilots. The delay has raised questions about whether controllers complied with procedures put in place after the 9/11 terrorist attacks.
Two bills were introduced in the Senate Thursday to ban nonessential electronics, including personal laptops, from the cockpit.

"We simply want to ensure that, with all of the electronic distractions available these days, flying the plane remains the one and only focus," Sen. Robert Menendez, D-N.J., the author of one of the bills, said in a statement.