Plan to use cruise ship as Olympics hotel hits rough water

Despite sharply cutting prices, a Canadian tour company has been unable to entice customers to a cruise ship it planned to used as a floating hotel during the Winter Olympics, and is scrambling to keep the idea afloat.

Meanwhile, customers who already have booked rooms on the Norwegian Star are uncertain whether they'll need to look for other hard-to-find lodging in Vancouver. And they haven't been able to get answers from Edmonton-based Newwest Special Projects.

"We're in a holding pattern. We don't know what to do," said Carol Oldham, a Fort Worth, Texas, woman who booked a room with two friends last summer. She was unable to confirm Monday whether the ship indeed will operate, and was advised to call again Tuesday.

A statement released by Newwest Special Projects said, "Our sales have not been what we had hoped for and our expenses have increased beyond what we ever expected."

The statement said the company is "negotiating with all of the parties involved with this project ... to try to lower costs and seek some concessions. We are making every effort to continue with our charter as planned."

Tamara Castellano, a spokeswoman for the company marketing the lodging, said Monday that customers had not been contacted about the company's difficulties because, "It's not clear what will happen."

Rates aboard the 1,100-room ship, once planned to top $1,000 U.S. a night, dropped to $500 last fall and, as of Monday, were listed on the company's Web site as low as $275 a night, including meals and onboard entertainment.

Industry sources told CBC News that the tour company likely paid $12 million to $15 million to charter the ship, and faced additional expenses securing the dock, getting work visas for the crew and making other arrangements.

Oldham said she and her two traveling companions booked their room for about $1,500 a night last summer. In October, when she heard that room rates were dropping, she contacted Newwest and was upgraded to a view suite, but at the original price.

The $400 million Norwegian Star, which entered service in 2001, was scheduled to sail from Los Angeles late this week.

One of Newwest's investors in Alberta, Abe Neufeld, told the CBC that negotiations over the ship's contracts are "tense" and a "tough struggle," but he remained hopeful the project would go ahead.

The 2010 Winter Olympics run from Feb. 12 to 28 in the Vancouver and Whistler areas.

Jack Broom: 206-464-2222 or jbroom@seattletimes.com