Wednesday, May 17, 2017

Dallas developer sells Houston's historic Petroleum Building to high-end hotelier

A Dallas-based development group sold the historic 21-story Petroleum Building, which is now called the Great Southwest Building, in downtown Houston to Choice Hotels International Inc. (NYSE: CHH) for a high-end hotel concept.

The acquisition is part of a larger expansion plan that Choice Hotels has embarked on to bring another 10 Cambria-branded hotels to the Lone Star state — in downtown Dallas at Tower Petroleum, downtown Houston in the former Petroleum Building, Richardson, near the Houston airport, downtown Austin on Rainey Street, San Antonio, The Woodlands, Midland, Waco and Galveston.

So far, Choice Hotels has invested $450 million into expanding the high-end brand in Texas and the rest of the country.

The hotelier's plans in Houston to redevelop the Art Deco skyscraper, which was built in 1927, at 1314 Texas St. come on the heels of Choice Hotel executives partnering with Dallas developer John Kirtland.

Choice Hotels plans on opening its new Cambria-branded hotel in the historic Tower Petroleum building in Dallas by this December. The hotel will be named Cambria Tower Petroleum Dallas.

"Based on the experience we have had in Dallas, we wanted to also develop the downtown Houston Petroleum Building — they are sister properties," Janis Cannon, senior vice president of upscale brands at Choice Hotels, told the Dallas Business Journal.

"The two buildings both have the same Art Deco design and are named the same," Cannon said. "We are really excited about these projects. They both embody what Cambria offers, which is an authentic experience."

Executives at Choice Hotels were attracted to downtown Dallas' growing residential demographic and the growing amenity-rich environment of the city's central business district.

In 2015, Dallas-based Todd Interests acquired the Petroleum Building in downtown Houston through a limited liability company, 1314 GSW Investors LP.
At the time, developer Shawn Todd, managing partner and CEO of Todd Interests, had intended to redevelop the historic office tower into a luxury apartment tower.

Todd's limited liability company sold the historic Art Deco office tower in February 2016 to CS HPB LLC, a limited liability company affiliated with Rockville, Maryland-based Choice Hotels International, according to Harris County deed records.

Candace Carlisle/Dallas Business Journal.