HOTELS: Haunted House

Chicago hotelmen have a saying that no one can make money on the Stevens Hotel but no other Chicago hotel can make money while the Stevens is running. Last week the Stevens tradition marched on: the U.S. Army Air Forces, which bought the huge hotel (world’s largest) as a training school only six months ago, now reversed itself and put it up for sale. Chicago innkeepers forthwith went into a deep dither over the “economic disaster’ they would suffer if the Stevens came back into competition. Plain citizens went into a dither over what seemed to be Army stupidity, grade A.

The Army, waving aside all advice, had stubbornly insisted on buying the Stevens. Cost: $6,000,000 (its original cost in 1927: $28,000,000). Then, in a fabulous five-day sale, the Army had auctioned off almost all the internal fixings of the Stevens—pots, pans, bowling alleys, beds, linen and spittoons (TIME, March 29). Realized from the sale: almost $600,000 (replacement value: over $2,000,000). The auction came just 90 days before the Army decided to sell the Stevens. Yet for only $3,000 a month in storage charges the Army could have held on to all the furnishings.

Now the Army, sick of its bargain, and having at last discovered that its soldiers were better trained at country training camps, wanted to sell the Stevens. This seemed stupidity compounded: where in this land of priorities could anyone possibly buy enough down-cushion sofas, good beds, copper and aluminum kettles and pans to refurnish the Stevens?

Cancellations. The Army is also cancelling its leases on 206 of the 434 hotels that the Air Forces have taken over during the past year.* (The Stevens is the only hotel actually bought by the Army that is to be sold—the others have been converted into hospitals.) In most cases, the Army bought itself a bargain: to build new quarters would have cost almost six times as much. By the time the Air Forces’ 9,000 men move out of the Stevens in mid-August, their rooming house will have cost almost $700,000 a month. The annual rental cost would have been about $800,000. The Air Forces now face the fact that an unfurnished hotel in wartime is just about as valuable as an airplane without an engine.

Catch Offers. The almost empty shell of the Stevens nevertheless attracted tentative offers, most of which presented catch clauses. One offered $7,500,000 for the Stevens, but stipulated that the U.S. Government must refurnish it.

The Army replied 1) that it would do no such thing; 2) that it was already looking around Chicago for furniture because it was aware the hotel was no good without it.

At week’s end the Army’s asking price was $4,000,000, with no takers. The Stevens began to look like the biggest haunted house in the U.S.

*Biggest mass cancellations: Atlantic City, where 35 out of 47 leased hotels are being turned back to private use, and Miami Beach, which will regain 109 of the 325 resort hotels taken over last year.