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Hamilton Properties Spending $34 million to Convert 83-year-old Warehouse
 into a 193 room Aloft Hotel near the Dallas Convention Center

By Steve Brown, The Dallas Morning NewsMcClatchy-Tribune Regional News

Apr. 21, 2008 --While Dallas city officials tussle over plans to build a convention center hotel, two developers have quietly started work on one.

Ted and Larry Hamilton's Aloft hotel project on Young Street is just south of the Dallas Convention Center.

"We are the closest hotel to the front door," said Ted Hamilton, who plans to have the boutique hotel open in 16 months.

Last week, crews from Andres Construction began work to turn an 83-year-old building at 1033 Young St. into a luxury hotel.

The project will be Starwood Hotels & Resorts' first Aloft hotel in Dallas.

Built as a warehouse for the Santa Fe Railway, the eight-story brick building has been vacant for more than a decade. Hamilton Properties is converting the 160,000-square-foot structure into a 193-room hotel.

"Actually, the place has been a hotel before -- the homeless were sleeping in the building," Mr. Hamilton said.

During a tour of the old warehouse last week, it was occupied only by layers of dust and crumbling building materials. Big metal windows in the brick and concrete building offer views of nearby City Hall and the convention center.

After the renovation, the ground floor will have a large bar and lobby gathering spaces.

A parking lot on the west side will be used to build a cylindrical entry court. On the back of the building, there will be a fitness center and a swimming pool. Basement railroad tunnels will be turned into meeting space.

The developers are adding a ninth floor to the old warehouse and have purchased parking lots on the north side.

"The Starwood people are describing this as an Aloft on steroids," said Larry Hamilton. "It will cost $34 million."

Hamilton Properties has been planning the project since early 2007. The development was delayed because of problems in the credit market.

An agreement to finance the hotel with a Wall Street firm fell through.

"We got caught in the credit crunch," said Tim Jordan, senior managing director with Holliday Fenoglio Fowler LP, who arranged the financing. "We went back into the market, and Hillcrest Bank stepped up to do the deal."

The Kansas City, Kan., bank is joined in the deal with lenders in Texas and Kansas.

"The regional banks have stepped in to fill the void left by Wall Street firms and big banks who are out of the market," Mr. Jordan said.

Architect One Group Design LP planned the project, which is directly across the street from the Pioneer Plaza waterfall and cattle drive sculpture.

The Hamiltons are Dallas' most experienced downtown building renovators. Their redevelopment projects include the Davis Building, the DP&L buildings and the new Mosaic apartment project on Bryan Street.

Hamilton Properties' hotel project is less than two blocks down Young Street from where the city of Dallas is considering plans to build a convention hotel. That development would have at least 1,000 rooms and be connected to the convention center.


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