Procaccianti Cracks Into Texas, Westin Name With 506-Room Buy

"We're in the process of formally entering into a franchise agreement," says Gregory D. Vickowski, Procaccianti's CFO. The Cranston, RI-based hotelier has several bids pending for more pickups in the Midwest and Southwest to cluster a portfolio for management purposes, he tells GlobeSt.com. Procaccianti owns 23 hotels, of which two each are located in Illinois and Oklahoma.

The first claim in Texas is the Harvey Hotel at 4545 John Carpenter Freeway in Irving, which the locally based FelCor inherited from Bristol Lodging Co. in October 1997. It, like others in the Bristol portfolio, is being traded in as FelCor trades up.

The Harvey Hotel, assessed at $12.3 million by Dallas County, came to market without an ask. Vickowski says Procaccianti paid cash in a 30-day look and 15-day close to outmaneuver others chasing the 7.9-acre property positioned 1.5 miles from the Dallas/Fort Worth International Airport. The hotel was the eighth purchase from a $400-million opportunity fund that closed last year. He says the $20-million renovation tab will be funded from one of the hotelier's usual sources.

The renovation is key to the play, according to Vickowski and FelCor's brokerage firm McLean, VA-based Molinaro Koger. "The Harvey Hotel trailed its competitors in rates recently. With the repositioning and the branding, the new owners can push the rate and improve numbers significantly," says Mark J. Rome, Molinaro Koger's vice president in Dallas. "It's a well-built hotel that can reposition easily." The repositioning promise brought offers from nearly 25 investors, with 10 making it to the final face-off as strong contenders, he says.

Would-be buyers were looking at a property that gets $70 per night. But, Vickowski says, "we believe the market is greater than $100." Last year, occupancy pushed above 70%."It's on track to do $16 million to $18 million gross this year," he confides. "We think this hotel re-branded and fully renovated will be a winner."

Vickowski says he's confident the Westin franchise agreement will pass muster with Starwood Hotels & Resorts Worldwide Inc. of White Plains, NY. The plan is to spend all of next year, beginning in January on renovating the 15-story hotel, taking down one or two floors at a time. The top-to-bottom makeover includes expanding the fitness center and adding a second swimming pool as well as room changes to bring it up to par with Westin's Heavenly Bed and Bath trademark. The lobby, common areas and the 37,000 sf of function space also are ticketed for upgrades. Vickowski says the repositioning targets corporate transient travel and hopes to catch overflow business from the Gaylord Texan in nearby Grapevine.