Moody National Emerges Victor for 316-Room Galleria Hotel

Located at 3131 W. Loop, the hotel opened doors in the mid-1960s as a Holiday Inn before being converted in the mid-1990s to a Courtyard by Marriott and Fairfield Inn. At the time of sale, occupancy averaged 92%, with room rate running $85 to $90 per day.

"This was up for bid, with no asking price. This is unusual in the hotel industry, unless it's a five-star type of asset," Lisa Hankamer, senior associate with CB Richard Ellis' hotel investments group in Houston, tells GlobeSt.com. She explains the process was used to create interest among potential buyers.

Hankamer and Bert Stevens, CBRE first vice president in Dallas, represented the seller of record, LBUBS 2001-C3 Houston Galleria LP from Dallas. Moody National was self-represented.

The sale price was not available, but the asset is appraised at $9.6 million by Harris County. Additionally, sources in the area point out that land values in the Galleria submarket are close to $80 per sf and in some cases, higher. "There's little land in that area left, which is what's boosting the value," Hankamer adds.

Hankamer says potential buyers nationwide came to examine the property for multiple uses. "They were looking at this for a lot of different things," she comments. "Hotel, definitely, multifamily, even condos."

Hankamer says Moody, aggressively pursuing US hotel acquisitions, put in one of the highest offers, but also won the seller's nod due to its local market knowledge. "They're right here, the hotel is in their own backyard," she says. "They have a strong sense of the short-term and long-term potential of the Galleria market." Moody is examining several alternatives to best reposition the acquisition, she adds.