PHOENIX—Adaptive Reuse was another think tank session at the Lodging Conference held at the Arizona Biltmore last week. The session moderator was Glenn Haussman, president of Rouse Media.

Panelists were Robert Habeeb, president and CEO of First Hospitality Group Inc., Kevin Kearney, vice president of upscale development, USA, Canada and The Caribbean, IHG; Ken Martin, principal of the hospitality sector at DLR Group, Rishi Patel, principal of Walton International and Sarang Peruri, principal of Oxford Capital Group LLC.

The discussion began with the historic, economic and environmental value of preserving, reviving and repurposing old buildings into innovative hotels. The group discussed the key in these types of projects is finding iconic buildings in outstanding locations that are convertible.

“Those projects are full of surprises if you do your homework. These buildings have a story so there is tremendous upside,” said Habeeb. “However, it is also important to recognize that sometimes a building is too far gone.”

The experts agreed it was important to bring the project team together early in the process. They said administrators of historic trusts or departments will set the tone for a project, with some focusing on an exterior or interior or things not readily visible.

“Approvals depend on who you get and you have to navigate through it,” Peruri said. That navigating includes negotiating, empathizing and giving on some things. Habeeb pointed out that the typical aspects of real estate redevelopments don't appeal to historical societies, such as economics, creation of jobs, etc., and those entities work on a different timeframe than the norm.

“However, sometimes municipalities go the opposite and are excited to get buildings converted,” said Habeeb.

Another caveat is the building materials needed to bring a building back to its original state are expensive. Peruri estimated that his firm has spent $10 to $20 million repairing facades because of the use of limestone.

“Artisans must be used for historic projects,” said Habeeb. “You can't just go to Home Depot and get replacement limestone.”

All of this takes time, said Kearney, which should be built into the building models. He recommends teams be creative and flexible with a shared vision of the project, knowing that there will be hot button issues with cities and municipalities. One such example is windows.

“Windows are a big pain in the butt,” said Peruri. “Historical societies will dig their heels in about them.”

The inclusion of retail will mitigate some of the pressures from the historical preservationists and cities, Martin said.

“Adaptive reuse is not for the faint of heart,” said Martin. “However, doing these projects is rewarding and they are the right thing to do.”

“However, sometimes municipalities go the opposite and are excited to get buildings converted,” said Habeeb.

“Artisans must be used for historic projects,” said Habeeb. “You can't just go to Home Depot and get replacement limestone.”

“Windows are a big pain in the butt,” said Peruri. “Historical societies will dig their heels in about them.”

The inclusion of retail will mitigate some of the pressures from the historical preservationists and cities, Martin said.

“Adaptive reuse is not for the faint of heart,” said Martin. “However, doing these projects is rewarding and they are the right thing to do.”

Instant Insights /

Hotel Adaptive Reuse Not for Faint of Heart

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