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Heritage Hotels and Resorts CEO Jim Long's Strategy -
Buy Hotels Losing Money in Regions Rich with History
By Lynda Edwards, The Arizona Daily Star, Tucson
Knight Ridder/Tribune Business News

Nov. 20, 2004 - Heritage Hotels and Resorts CEO Jim Long sees himself as a turnaround artist who transforms hotel beasts bleeding money into profitable beauties.

Long just completed a $5.5 million renovation of his first Arizona acquisition, Rio Rico Resort & Country Club. The resort, about 45 miles south of Tucson, is now named Esplendor Resort.

A $9,000 antique Peruvian table and a 200-year-old fertility chair carved with lions and pregnant women are now centerpieces in Esplendor's lobby. Bricks colored with ox blood pave the floors. Heritage hired a blacksmith to make iron sconces designed by Long, an architect.

"We want visitors to feel transported into the past in our hotels," Long explained. "We research the region to figure out what travelers would have encountered there a hundred years ago in a luxurious hotel." Heritage owns five New Mexico hotels and one in Ohio. Long is also CEO of Heritage's parent company, American Property Management Corp., which he founded in 1987. American Property was listed as the 23rd-biggest hotel owner in the U.S. by the trade journal Hotel Business.

Long launched Heritage four years ago.

"It was partly a tribute to my heritage as a Hispanic," Long said. "And I believe that tourists who seek out historic hotels are a solid demographic. They tend to spend more and stay longer. My strategy for Heritage is to buy hotels losing money in regions rich with history." He's not the only one doing so in the Santa Cruz River valley. Ten miles to the north, the Tubac Golf Resort is undergoing a $27 million renovation that celebrates its own heritage.

Long was attracted to the history of Rio Rico and Tubac under Spanish missionaries, Mexican settlers and eventually Bohemian artists.

"And the Rio Rico resort was losing money," Long added.

The resort, which has about 180 rooms, plans to offer them at rates ranging from $89 to $299 in the high season.

Long bought the resort, which has a Robert Trent Jones golf course, for $5.49 million from Florida-based Avatar Properties two years ago.

Heritage project manager Jason Cosyleon researches the history of every hotel locale.

"Then I start buying antiques that look like they fit the period," Cosyleon said. "We have our own blacksmith, tinsmith and historian to help us. We used descriptions of the missions as our inspiration when we designed the garden." His historian discovered that Mexican craftsmen used chicken manure to tint adobe bricks rose, purple and deep blue indigo. When the chickens ate wildflowers or certain grains, apparently they excreted a rainbow.

"It was a special recipe," Cosyleon said, laughing. He plans to use the chicken-tinted bricks to decorate the garden walls.

Although Long spent money to create the garden, the hotel exterior remains the same.

"I figure that even a hotel that looks like a concrete box outside can draw guests inside if the interiors are beautiful," Long said. "We tend to spend our money inside and on the grounds." The same year that American Properties bought Esplendor, 2002, a Telluride, Colo., developer bought Tubac Golf Resort just 10 miles away. Tubac Golf Resort was built on the site of a ranch owned by a pioneer Spanish family. Like Esplendor, the Tubac resort invokes regional history with 18 adobe casitas. The public rooms are styled as Old West haciendas. Even the bar uses saddles as adornments.

And Tubac Golf marketing director Mark Scheller said the new owner is spending $23 million to renovate and expand the resort. A retail village and mission chapel are under construction at the resort. Scheller said the number of casitas will double. He expects room rates to range from $199 to $299 in high season.

"We see Esplendor as complementary, not competition," Scheller said. "The two resorts are very different in mood and amenities. I  think both resorts will thrive."

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