|By Vic Kolenc, El Paso Times,
TexasMcClatchy-Tribune Regional News
Oct. 31, 2011--A Dallas hotel operator says he has a national hotel brand interested in the vacant Artisan Hotel.
Perry Molubhoy, president of Atlantic Hotels, which operates five brand-name hotels in Dallas, said last week that Aloft, a new brand in the Starwood Hotels & Resorts Worldwide hotel family, has indicated interest in the Artisan for a possible franchise.
Atlantic has an agreement to buy the bankrupt, 126-room Artisan for $2 million from a Las Vegas investors group.
Molubhoy said last week he received what he called a "soft letter" from Starwood indicating interest in the Artisan building as a possible Aloft franchise. Molubhoy said he can use the letter to go to lenders to try to get financing for the hotel, which would need about $12 million worth of renovations to become an Aloft, he said.
Molubhoy said he could not provide a copy of the letter to the El Paso Times because it contains proprietary information.
Jennifer Leemann, a spokeswoman for Starwood Hotels at its White Plains, N.Y., headquarters, said in an email that the company has no comment on whether Aloft has interest in the Artisan location.
Molubhoy said Atlantic needs a franchise commitment from Aloft before it can buy the Artisan. It will probably take another 60 days to do things necessary to get that commitment, he said.
That means Atlantic needs to get an extension of its Artisan sales agreement, set to expire Nov. 15, Molubhoy said. The agreement is with a Las Vegas investors group tied to
Integrated Financial Associates, a Las Vegas mortgage broker. An extension on the agreement would have to be approved by a federal bankruptcy court in Las Vegas.
The Artisan closed in March 2010 after a rocky five months of operation by controversial Las Vegas owner Douglas Da Silva.
Molubhoy said Atlantic also needs tax breaks from the city to make renovating the Artisan feasible.
Mathew McElroy, deputy director of the city Department of Planning and Economic Development, said he talked with Molubhoy last week and sent him information about possible city incentives.
"He (Molubhoy) thinks they have a national chain locked up" for the Artisan, McElroy said. But the city can't do much until Atlantic owns the hotel, he said.
Once it's certain Atlantic will move forward with the Artisan renovation, city staff would probably recommend that the City Council provide the project tax incentives similar to those offered for renovation of a dilapidated Downtown building that's now the DoubleTree Hotel by Hilton, McElroy said.
Aloft, started by Starwood in 2008, has 52 hotels worldwide -- making it the fastest brand launch in hotel industry history -- Starwood reported.
The limited-service, hip brand is aimed at the "digital generation" with urban, modern, vibrant designs at an affordable price, according to Starwood.
Starwood recently announced a strategy of converting existing hotels into Alofts. It's renovating a former 253-room Clarion Hotel in San Francisco to make it an Aloft. A Downtown Aloft Hotel in Dallas is in a former railroad depot.
"Conversions are exciting from a brand standpoint because they allow us to bring the Aloft experience to new markets more quickly, which can only enhance its already-powerful growth," Brian McGuinness, senior vice president of Starwood's specialty select brands, said in a recent written statement.
Vic Kolenc may be reached at firstname.lastname@example.org; 546-6421.
More information: atlantichotelsgroup.com; starwoodhotels.com/alofthotels
(c)2011 the El Paso Times (El Paso, Texas)
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