A San Francisco-based hotel investment group has purchased the last of the Adam's Mark hotel portfolio and plans to spend more than $238 million to rebrand, renovate and reposition the five properties over the next 18 months.
The deal gives the Chartres Lodging Group, formerly known as Oxford Lodging Advisory and Investment Group, high-profile, convention-oriented hotels in Dallas, Denver, St. Louis, Indianapolis and Buffalo, N.Y.
Chartres Lodging originally entered into an agreement to purchase the 4,867-room portfolio from the St. Louis-based HBE Corp. last May in what Chartres Lodging co-founder and managing partner Maki Nakamura Bara called a "unique opportunity."
He mentioned the "cost and scarcity of comparable downtown development projects."
Upon completing the deal for the final five hotels last week, Chartres said the Denver and Dallas properties would become Sheratons and the St. Louis hotel a Hyatt.
Company spokesman Bob Ochsner said the Indianapolis hotel would also be reflagged, but he could not yet say what its new brand would be. The Buffalo-Niagra hotel, he said, would remain an Adam's Mark.
HBE has been selling off its properties over the last several years. In 2004, Pyramid Advisors and the Morgan Stanley Real Estate Fund IV-Domestic, in a joint venture, acquired eight Adam's Mark hotels from HBE for $236 million.
In 2005, a Chartres-led investment group bought the Jacksonville, Fla., Adam's Mark.
The company said its plans for the properties would be patterned after the multimillion-dollar renovation and transformation of the Jacksonville hotel, which is now the Hyatt Regency Jacksonville Riverfront.
The deal gives Sheraton the largest hotels in Dallas and Denver.
Starwood Hotels & Resorts, owner of the Sheraton brand, said the move was "part of a larger comprehensive revitalization and expansion of the Sheraton brand currently being implemented worldwide."
Sheraton is embarking on a "bold plan" to reposition itself via room renovations and upgrades, according to Hoyt Harper, Sheraton's senior vice president.
He said the plan should result in 50,000 new or renovated rooms in North America by 2009, and 60 new hotels in the next two-and-a-half years in "high-profile U.S. cities."
"The new Dallas and Denver hotels will ... illustrate the brand's focus on large convention hotels," Harper added.
In April, the Adam's Mark Dallas, a 1,842-room hotel, will become the Sheraton Dallas Hotel. The property has 230,000 square feet of meetings space, including the largest ballroom in Texas.
The hotel is located in the heart of the Dallas commercial center and is attached via sky bridge to another Starwood property, the Westin City Center, Dallas.
The Adam's Mark, Denver, a 1,225-room hotel, will be renamed the Sheraton Denver. The property has 130,000 square feet of conference space and nearly 50 meetings rooms.
The hotel is located in downtown Denver near the state capital and on the 16th Street pedestrian mall.
The management of the Adam's Mark St. Louis, a 910-room property adjacent to the Gateway Arch, has been assumed by Hyatt and will be rebranded as the Hyatt Regency St. Louis Waterfront this spring.
The Adam's Mark Indianapolis, a 406-room property at Indianapolis Airport, will be managed as an Adam's Mark by Kokua Hospitality, a Chartres Lodging affiliate, until it is rebranded.
The 486-room Adam's Mark Buffalo-Niagara, in the heart of Buffalo's downtown business district, will also be run by Kokua Hospitality as an Adam's Mark.
To contact reporter Jeri Clausing, send e-mail to [email protected].