Posted on: March 28 2012 | Posted in: Latest NewsThe number of hotel conversions of historic properties is rising in the U.S. as developers steer away from new constructions due to limited lending availability, this feature says. Despite the challenges inherent in modernizing older structures, these landmarks still draw investor interest usually because of their strategic locations. "If you're in the right place in downtown, it can be a slam dunk. You're where people want to be," said Joseph McInerney, president and CEO of AH&LA.
March 26, 2012
By Rob Lovitt, msnbc.com contributor
If your next hotel stay has you dreaming of movie stars or mail carriers, it may not be your imagination. From Los Angeles to Tampa, Fla., to the nation’s capital, hotel developers are embarking on projects that promise to breathe new life into theaters, post offices and other historic buildings.
“The allure of a historic building is its grandeur, its location and its architecture,” said Bruce Ford, senior vice president of Lodging Econometrics, which tracks hospitality-industry transactions. “To integrate that into a modern development can be a home run if it’s done right.”
The latest developer to take a swing, of course, is Donald Trump, who announced a deal last month to convert the Old Post Office building in Washington, D.C., into a 260-room luxury hotel. Originally opened in 1899, the Pennsylvania Avenue landmark is famous for its grand Romanesque design and the panoramic views from its 315-foot clock tower.
“I look forward to preserving and repositioning this treasured landmark for D.C. residents and visitors to enjoy,” wrote Trump in a recent op-ed piece for The Washington Post. “When the project is completed in 2016, I feel certain that everybody will be proud of our enhancements to this already great building. We will not let you down.”
Nor is Trump the only developer with plans to turn an historic building into a new hotel. With financing for new construction still tight, renovating former post offices, courthouses and office buildings is considered a way to provide uncommon lodging experiences for guests while preserving civic landmarks.
Among the current projects:
- In early January, the city of Tampa announced it had struck a deal to turn the city’s Federal Courthouse into a hotel. Vacant for more than a decade, the Beaux Arts building will feature about 130 guestrooms, said Gary Prosterman, president and CEO of DSG, part of the development team.
- In late January, the Ace Hotel chain announced it would turn the United Artists Building in downtown Los Angeles into a 180-room hotel. A classic example of Spanish Gothic architecture, the building was originally built in 1927 and houses a 1,600-seat theater opened by Charlie Chaplin, Mary Pickford and the other actors who formed United Artists.
- In September, Kimpton Hotels & Restaurants expects to open a 268-room Monaco Hotel in the 1906 Lafayette Building in downtown Philadelphia. The former office building, which has been vacant for several years, is across the street from Independence Hall and the Liberty Bell.
Such projects speak to both the charm and challenges of adapting old buildings for new uses.
“What’s really appealing about these buildings is their spectacular architecture,” said Prosterman. “They’re built with materials you really can’t afford to duplicate today.” In many cases, high ceilings, wide corridors and large windows offering plenty of natural light further enhance the experience.
On the other hand, integrating modern amenities into older buildings while meeting strict requirements for historical preservation is neither easy nor inexpensive.
“I can pinpoint more than two dozen spots where it’s been done successfully and I can pinpoint more than eight dozen where it’s failed miserably,” said Ford. “It takes a very savvy developer to put it together and it usually takes a big commitment from the city to see it through.”
Nevertheless, and despite their distinct histories, all of the above projects share a common element that bodes well for their success. Built in an earlier day, when city-center sites were available and affordable, they adhere to the golden rule of real estate: location, location, location.
“If you’re in the right place in downtown, it can be a slam dunk,” said Joseph McInerney, president and CEO of the American Hotel & Lodging Association. “You’re where people want to be.”
That’s especially true, he said, for the Old Post Office building. “You walk out your front door and you look one way to the Capitol, the other way to the White House,” he told msnbc.com. “If Trump can work it out, he’s going to hit a home run.”