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Silverdale hotel's new owners will lease restaurant, bar to outside operator

The Silverdale Beach Hotel is getting its exterior repainted as part of remodeling inside and out at the hotel, which was sold to a group of investors recently and will become a Best Western.The restaurant in the Silverdale Beach Hotel will reopen soon, but an outside operator will lease the former Josef’s Waterfront Grill and the hotel bar from the new owners who recently bought the property.

An out-of-town ownership group organized as Silverdale Hotel Group, LLC bought the 151-room hotel, which had been on the market for more than a year, a month ago for $6.8 million and plan to make it a Best Western brand. The restaurant was closed after the sale, but has since reopened to provide only a breakfast buffet.

General manager Bryan Shorb said recently the hotel has reached an agreement with a local company that has other food service operations in the Kitsap area to take over the restaurant in the near future, as well as the hotel bar that has operated as the Auto Bar Lounge. He did not identify the company.

Also, after the sale the new owners contracted with an outside caterer — Le Garmache of Port Orchard — to provide food service for banquets and other events at the hotel.

“The change of ownership was on a Thursday (June 28), and we were in there starting to do banquets on Friday,” said Betsy Jolliffe, co-owner of Le Garmache.

She said her company already provides banquet catering for the Best Western hotel in Gig Harbor and for Baymont Inn and Suites and the Oyster Bay Inn in Bremerton.

The closing of the restaurant and the new outside catering contract resulted in most of the hotel’s kitchen and banquet staff losing their jobs, Shorb confirmed.

He said the restaurant had never been profitable as an in-house operation since the hotel opened in 1986.

Overall, the hotel was on track to have a profitable year before the sale, Shorb said, reversing a number of years of losses. He said the operation should be more profitable by focusing on the core hotel business and contracting out the restaurant and catering services.

The entire property is undergoing interior and exterior renovations and remodeling to meet requirements for converting the hotel to a Best Western, a process Shorb said should be completed sometime this fall.

“We’re making improvements to make it higher quality, a little classier, and it will also be better for upkeep,” he said.

The property’s assessed value has dropped for three consecutive years, from a high of $8.4 million in 2009 to $7.7 million and $7.3 million the next two years, and $5.6 million for 2012, according to Kitsap County Assessor’s records, which list the property owner as Josef Diamond Investments LLC, the Seattle-based company that owns a regional network of paid parking lots.

The investors in the new ownership group, according to Silverdale Hotel Group’s application to maintain the hotel’s liquor license, are Baldev Singh Johal, Venu Kondle, Balbir Golsal, Harinder S. Johl, Waseem Akhtar and Jasdeep Singh. None of them were available for comment.

Shorb said the investors have various other holdings in the lodging and hospitality industry, but the Silverdale hotel is the only property they own in Washington state.

Reopening the restaurant to maintain the Silverdale property as a full-service hotel — it also has a ballroom and a total of 5,000 square feet of meeting space — is a plus in the view of Patty Graf-Hoke, executive director of the Kitsap Peninsula Visitors and Convention Bureau.

“I don’t have very many properties (like that) to work with,” she said. “It’s not a high-end destination hotel, but it certainly has the potential to be that.”

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