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Metro Hospitality Partners Acquires the Former AstroVillage Hotel Complex
 in Houston; Will Renovate 700 rooms and 52,000 Sq Ft of Conference Space

By Nancy Sarnoff, Houston Chronicle
Knight Ridder/Tribune Business News

Dec. 1, 2005 - A real estate investment group has purchased a hotel property near Reliant Park with plans to renovate the main building and rename it for at least the fifth time in its history, which dates back to the 1960s.

Houston-based Metro Hospitality Partners acquired the nine-story Park Plaza Hotel, along with two smaller hotels no longer in operation, for an undisclosed amount. One of the new owners' first changes is to rename it the Houston Grand Plaza Hotel.

Located on 16 acres at the northwest corner of Kirby Drive and the South Loop, the properties were once known as the Astrodomain hotels or the AstroVillage hotel complex.

The tallest structure on the property was built in 1969 by the late Judge Roy Hofheinz, the former city mayor who developed the Astrodome.

"This is a beautiful piece of Houston's history, and we are excited to breathe new life into it," said Jody Jabour, the property's new general manager.

The hotel's restoration comes at a time when the area around the South Loop is changing.

"It's on a prime corner of an area of Houston that is seeing tremendous revitalization, largely due to the development of Reliant Stadium and Reliant Park, as well as the Medical Center's growth southward to Loop 610 and beyond," Jabour said.

Indeed, farther south real estate developers have been buying large blocks of land surrounding the last stop on Metro's light rail line. They expect the train to increase demand for new shops and homes.

Plus, AstroWorld has closed. Owner Six Flags is deconstructing the amusement park, just south of the 610 Loop, and is selling the land.

When the renovations are complete in about a year, the hotel at 8686 Kirby will contain close to 700 rooms and more than 52,000 square feet of updated conference space, Jabour said.

Most of the rooms will be in the property's main tower, which is connected to a smaller hotel by a series of low-rise suites and meeting rooms.

The new owners plan to renovate and reopen the rooms in the smaller hotel, which once operated as a Holiday Inn. A shuttered Days Inn on the northern end of the property will be demolished and the land used for parking.

Aside from the rooms, the renovations will include a new fitness center and spa, full-service restaurant, lounge, cigar bar and jazz club.

And a hotel suite, originally designed for Hofheinz himself, is being restored to its original state. The so-called Celestial Suite, which takes up the property's entire ninth floor, took nearly a year to complete and was once listed as the most expensive hotel room in the Guinness Book of Records, according to the new owners.

The suite has 13 rooms, each with a different design.

Throughout its 36-year-old history, the nine-story hotel has had many owners and names, including the AstroVillage Hotel, the Sheraton Astrodome, Radisson Astrodome and most recently, the Park Plaza Hotel Reliant Center.

Over the years, occupancy at the property suffered from increased competition and a lack of corporate demand, according to John Keeling of hotel advisory firm PKF Consulting.

"The difference down there is that there are really no demand generators," Keeling said.

While the property benefits from such major events at Reliant Park as the Houston Livestock Show and Rodeo and the Offshore Technology Conference, smaller shows held there, like boat expos and bridal fairs, attract mostly locals who don't occupy hotel rooms.

About three years ago, the hotels fell into foreclosure after the owners defaulted on a $28 million note.

Keeling said the property's success will depend on whether the new owners will be able to attract groups to fill the hotel's rooms and meeting space.

Jabour said updating and increasing the number of hotel rooms at the property will help bring in business.

The property currently has 321 rooms that can be occupied.

"At one time this particular hotel was pretty outstanding in Houston," Jabour said. "I think we'll be able to create a strong market share by increasing the level of service."

The hotel will remain open during the renovations. The old sign on the hotel is expected to be replaced next week.


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