Tuesday, August 09, 2011

Major real estate investor buys Fairmont Dallas for $69 million

A major real estate trust said Tuesday it has purchased the Fairmont Dallas for $69 million, marking the second acquisition of a historic Dallas hotel in two weeks.
Inland American Lodging Group Inc., a Florida subsidiary of Illinois-based Inland American Real Estate Trust Inc., takes possession of a 42-year-old fixture on the Dallas skyline. The Fairmont Dallas opened in 1969 as one of the first luxury hotels in Texas. The hotel, with 545 guestrooms in two towers and 70,000 square feet of meeting space, received $14.9 million in renovations in the past four years.
The purchase, from California-based Pacific Coast Capital Partners and DiNapoli Capital Partners, also adds to Inland American’s presence downtown. Last October, Inland American acquired the 407-room Westin City Center downtown and rebranded it as a Marriott.
“The Fairmont Dallas fits all of our value and strategic investment criteria,” Marcel Verbaas, president and chief executive of an Inland American subsidiary, said in a prepared statement. “This transaction also extends our commitment to furthering the success of downtown Dallas and the Arts District.”
Most of the company’s Texas hotels fall into the “limited service” category with brands such as Courtyard and Residence Inn, which appeal largely to business travelers.
“Now we’re starting to get more into the full-service, luxury space,” said Dan Lombardo, senior investor relations manager for the REIT.
Dallas hotels have been especially attractive to investors of late. Last week, Rosewood Corp. and St. Louis-based Maritz, Wolff & Co. sold five Rosewood-branded hotels to Hong Kong investors. The properties included the Rosewood Crescent Hotel and the Rosewood Mansion on Turtle Creek.
Lombardo said his company was drawn to North Texas’ resilient economy, population growth and appeal as a convention destination.
“Texas is an area we’re looking at not only for lodging but also for other property types,” he said, noting that Inland American also owns industrial, office and multifamily buildings.