It looks like Donald Trump will get a Pennsylvania Avenue address after all.
The hotel company run by the real estate and casino magnate, "Apprentice" star and one-time Republican presidential candidate was tapped by the General Services Administration (GSA) to redevelop the historical Old Post Office Building in Washington into a luxury hotel.
Trump's bid beat out hoteliers such as Hilton Worldwide, which had proposed a Waldorf Astoria there.
The Trump Organization, along with financial partner Colony Capital, will redevelop the 113-year-old building at Pennsylvania Avenue and 12th Street, about four blocks east of the White House, into a property that will include more than 250 hotel rooms, several restaurants, a ballroom and a curated museum.
The hotel will be called the Trump International Hotel, The Old Post Office, Washington, D.C.
Trump and Los Angeles-based Colony partnered on the 1998 redevelopment of New York's 610 Park Ave. luxury-condo building. Colony, whose other investments include Fairmont Raffles Hotels andSwissotel Hotels & Resorts, will spend an estimated $200 million on the project and enter into a 60-year lease with the GSA.
Plans call for the project to break ground in 2014 and be completed in 2016.
David Orowitz, vice president of acquisitions and development at the Trump Organization, said his company likely got the nod from the GSA because of its willingness to preserve the building's architectural attributes and ensure continued public access to much of the property.
"Our plan was really sensitive to what the GSA was looking for," Orowitz said.
Orowitz declined to specify what Trump's and Colony's respective investments would be, saying only that both companies would invest "significant" equity.
The contract is a much-needed win for a company whose namesake is world famous but whose hotel-development track record is mixed. The Trump Hotel Collection includes seven properties, including a Toronto hotel that opened late last month, but Trump Entertainment Resorts and its three hotel-casinos, crushed by a drop-off in Atlantic City travel spending and gambling, declared bankruptcy in 2009. They emerged from Chapter 11 last year.
Hilton had proposed to convert the building to a 245-room Waldorf Astoria, which would have been Washington's first. Hilton said in a statement that it was "disappointed" by the decision.
Hyatt Hotels & Resorts also reportedly submitted a bid, though the company declined to comment on the process.
Trump looks to bank on a Washington luxury hotel market where room supply is down about 5% from a year ago and where luxury hotels are outperforming lower-end hotels.
Revenue per available room (RevPAR) at luxury properties in the Washington metro area increased 6% last year, while overall RevPAR was up just 1.5%, the lowest of the 25 largest U.S. markets, according to Smith Travel Research.
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