Jun. 21--FORT WORTH, Texas--A Dallas investment group is negotiating to buy and overhaul the aging downtown Ramada Plaza Hotel in a deal that could prompt the city to postpone construction of its own 600-room, $120 million facility. 

Officials with the Harrell Hospitality Group said Thursday that they have the Ramada property under contract and hope to buy the building before the end of September. 

"We like Fort Worth, and we like what we've seen so far," said Paul Barham, Harrell's chief executive. "We are really looking at this in concert with what the city is doing. 

"There are many positive things happening." 

Barham declined to name a purchase price for the hotel, but said renovating the property at 1701 Commerce St. could take about a year and cost more than $15 million. 

Mayor Kenneth Barr said he has been aware of Barham's intentions, but officials haven't discussed whether the city could offer financial incentives for redoing the hotel. 

Barr, however, said an overhaul of the Ramada property likely would not derail the city's plans for its own convention center hotel. 

"A completely rebuilt hotel at that location would be a great asset, but it's not as close to the convention center as we would like it to be," he said. "Whether it would adequately meet our needs as a convention center hotel remains to be seen; but right now, I doubt that it does." 

If the Ramada property is redeveloped, it would likely be run under Marriott management, City Manager Gary Jackson said. Marriott also manages two other downtown hotels -- the Courtyard and the Renaissance Worthington. 

Construction of a convention center hotel and parking lot has been discussed by city officials for several years. The latest plans call for an upscale facility on two city-owned lots on Houston Street at 11th and 12th streets west of the convention center. 

The hotel would include meeting and ballroom space, 500 parking spots and a full-service restaurant, as well as such other amenities as room service, on-site laundry service and a health club. 

Officials say the hotel would complement ongoing renovations at the convention center, which are estimated to cost $75 million. The first round of improvements, including a new ballroom and more exhibit and meeting space, were completed in April. 

City officials say they are losing valuable business because the city does not have a luxury hotel to lure convention-goers. 

"We need additional, first-class space for conventions, visitors and tourists," Jackson said. "This is a critical hole to fill to attract national conventions that our center is now able to accommodate." 

No deal has been signed, but Hilton Hotels Corp. executives say they are eager to manage a city-owned convention center hotel and have already begun preparing a marketing plan for the project. 

The Ramada property has 430 rooms, 20,000 square feet of meeting space, a spa and fitness center, a business center, and an indoor pool and parking. 

Built in 1972, it has an appraised value of about $3.5 million this year, Tarrant Appraisal District records show. 

John Keeling, senior vice president of PKF Consulting in Houston, said a renovated Ramada would be good for Fort Worth but is not big enough for a convention center hotel. 

"You can't be taken seriously as a convention hotel at 400 rooms," he said, adding that at least 600 rooms will be needed to keep convention-goers in one location. 

Doug Harman, chief executive of the Fort Worth Convention & Visitors Bureau, said the Ramada needs to be upgraded to put it on par with the newly renovated convention center. 

"When people think Ramada, they think of a small hotel along the highway and not a downtown property," Harman said. 

Bruce Walker, a hotel consultant with Source Strategies in San Antonio, praised plans to remodel the Ramada but questioned the need for a city-owned facility downtown, where occupancy and revenues have been down. 

"Building a new hotel would decimate the existing hotels," he said. 

Local hotel operators agreed. 

"If there is an alternative -- to do something with the Ramada -- I say seize the day, "carpe diem,"" said Chad Crandell, president of Capital Hotel Management, which owns the Renaissance Worthington Hotel at 200 Main St. 

City Councilman Jeff Wentworth said a new hotel could spur downtown business. 

"Everything depends on the timing and how fast the economy recovers -- and how successful the convention center is in booking new businesses," he said. 

"In the long-term, this could help because hopefully with the convention center remodeling and additions, we are going to get more and higher-paying conventioneers into the city." 

Jackson said the city plans to study the issue through the summer and hopes to make a decision later this year on whether to proceed with its own hotel. 

"One way or another, we have to create 400 to 600 four-star convention hotel rooms," he said. 

--By Ginger D. Richardson and Anna M. Tinsley 

--Staff writer Sean Wood contributed to this report. 

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(c) 2002, Fort Worth Star-Telegram, Texas. Distributed by Knight Ridder/Tribune Business News. MAR, HLT,