Construction Begins on Hyatt Regency in Houston

HOUSTON-Construction has commenced on the 325-room Hyatt Regency hotel located across the street from the Houston Galleria.

The 14-story, 260,000-square-foot property, owned by a partnership of The Carlyle Group of Washington, DC and Atlanta-based Songy HighRoads, will feature 350-square-foot guestrooms, 20 suites, 15,000 square feet of meeting space and a large fitness center.

The new construction will create an estimated 800 jobs over the duration of the project, according to the general contractor McCarthy Construction, and an estimated 150 jobs after opening. Aimbridge Hospitality will manage the hotel.

“We are pleased to work with Hyatt and Aimbridge Hospitality on this new hotel for the Galleria area,” states Todd Nocerini, COO of Songy HighRoads. “Houston has strong job growth and an increasing population and Galleria is one of the top sub markets in the country.”

“This groundbreaking represents the first addition to the Galleria Plaza mixed-use complex, which Carlyle and Songy acquired earlier this year,” adds Thad Paul, managing director at The Carlyle Group. “With the hotel occupancy rate over 77% in the Galleria submarket and given most of the existing full-service hotel inventory is over 20 years old, the Hyatt Regency will be a valuable resource to the thousands of tenants in the 31 million square feet of nearby office space and to the leisure visitors to the Galleria area.”

Songy HighRoads LLC and The Carlyle Group purchased the mixed-use Galleria Plaza in March 2013. The acquisition included two office buildings (5233 and 5251 Westheimer Road), a multi-tenant retail building, and two stand-alone retail properties totaling 395,473 square feet of office space and 28,920 square feet of retail space on 7.6 acres.

Equity capital for the development comes from Carlyle Realty Partners VI, a $2.34-billion fund that invests in real estate in North America. A syndicate led by Amegy Bank provided debt financing for the development.