HOUSTON – (Realty News Report) – Downtown’s 223-room Hotel Alessandra, which closed down in January amid a tough Covid business environment, has been acquired by Host Hotels and Resorts for $65 million.
The 20-story hotel, 1070 Dallas Street, developed by Houston-based Midway and managed by Valencia Hotel Group, opened in 2017.
“We opportunistically acquired this 223-room hotel for $65 million or $291,000 per room on July 2, prior to a scheduled foreclosure auction,” said Host Hotels CEO Jim Risoleo in a conference call with industry analysts last week. “Our ability to source and close on this distressed off-market acquisition is truly a testament to Host’s deep industry relationship, strong balance sheet and ability to close reliably and quickly. Having recently opened in October 2017, this hotel is in excellent condition and we expect little to no capital to be invested in the near-term.”
Midway declined to comment on the Host Hotels acquisition, which occurred four days before the scheduled foreclosure event.
The Host Hotels CEO said the $65 million price presented good value compared to the estimated $90 million it cost to build. The hotel was designed by Gensler with Rottet Studio doing the interiors.
When Midway began developing the Hotel Alessandra, the Houston-based real estate firm said at the time the hotel was designed to provide the hospitality element for Midway’s three-block GreenStreet mixed-use development, which includes office space, retail, restaurants and entertainment, along Lamar Street, east of Main Street.
But the hotel, which was not affiliated with a major hospitality chain, opened just as oil prices began to slide into an extended decline – a tough climate to stabilize occupancy a new property in downtown Houston.
Bethesda, Maryland-based Host Hotels, which recently acquired the Hyatt Regency in downtown Austin for $161 million, isn’t going to put the former Hotel Alessandra in mothballs.
Expect to see a new name and a hotel chain affiliation in short order. Host currently operates four hotels in Houston – three Marriotts and the St. Regis Houston.
Reopening the hotel will bring fresh enterprise and activity into the GreenStreet development, which has been is undergoing a capital improvement program. Life Time recently leased 108,000 SF for a fitness resort, spa, café and the company’s co-working concept, Life Time Work.
GreenStreet has three components – two stories of creative office atop ground floor retail; the 11-story, 260,000-SF GreenStreet office tower, most recently NRG’s Houston headquarters; and the attached parking garage with 1,450 spaces and 24,000 SF of additional office space. GreenStreet, located within walking distance of the George R. Brown Convention Center, houses tenants including House of Blues, Guadalajara and AT&T SportsNet.
A new Palm Restaurant is set to open this fall in GreenStreet in the 1100 block of Lamar.
Midway owns a number of hotels including The Moran CityCentre, a 266-room hostelry which has been ranked by Conde Nast as one of Houston’s top 10 hotels.
Aug 10, 2021 Realty News Report Copyright 2021
Photo: By Ralph Bivins, Realty News Report Copyright 2021
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Transaction: A JLL team led by John Nugent and Colby Mueck assisted Midway.
File: New Ownership for Shuttered Hotel in Downtown
File: (2) Midway. New Ownership for Shuttered Hotel Alessandra in Downtown Houston. Host Hotels & Resorts. GreenStreet, Hyatt Regency Austin.