A venture consisting of Haverford Hotel Partners and
Haverford Properties Inc. bought the Holiday Inn Fort Washington and has plans
to invest an estimated $19 million redeveloping the property.
Bill McNamara, managing partner of Haverford Hotel
Partners, and Charles Houder, principal of Haverford Properties, picked up the
230-room, full-service hotel on seven acres in Montgomery County from a
Washington, D.C., investor who has owned the property since it was developed in
1975. Joe McCann, head of Optimum Hotel Brokerage, arranged the sale.
Terms of the transaction weren’t disclosed though total
investment in redeveloping the property, including acquisition costs, stands at
about $19 million.
Though state-of-the-art when it was built, the property
at 432 Pennsylvania Ave. had been on the decline and had a business that kept
just about half of it occupied.
It wasn’t an easy sell, according to McCann.
“We had the property on the market for about a year and
we had to go through a year of due diligence with zoning approvals being made,”
he said. “The right buyer needed extensive due diligence because of all of the
approvals that were needed for his project. It’s an expensive proposition, but
it will be nice development.”
Aside from zoning, part of the process involved the
seller shuttering the property and laying off its 61 employees. A redevelopment
on this scale requires such a drastic measure.
Both McNamara and Houder were attracted to the hotel’s
location near the Pennsylvania Turnpike and Route 309 as well as next to a
regional rail stop. It’s also within the Fort Washington Business Park and in
proximity to other markets such as Horsham, Willow Grove and Plymouth Meeting.
“The Pennsylvania Avenue corridor has been overlooked and
neglected because of its historical issues,” Houder said.
The park was known to frequently flood whenever there was
a downpour. That issue is being remedied.
The partnership looks for value-add opportunities such as
this.
“We like to take something underutilized and reposition
it to the product it wants to be,” said Houder, who, at one point, worked at
Preferred Real Estate Investments.
Plans call for redeveloping the eight-story hotel inside
and out. The façade will be redone as well as other exterior elements. It will
no longer be a full-service property — having a restaurant within the hotel —
and it will instead have 168 rooms and suites. It will be branded as a Holiday
Inn Express.
A restaurant will be constructed on a separate pad site
on the property as well as what is rumored to be a freestanding Starbucks with
a drive-through window. The Fort Washington property is expected to reopen in
December.
“We are repurposing the hotel so it has a 21st century
focus,” said McNamara, who has deployed this strategy at other hotels.
Haverford Hotel Partners owns a Holiday Inn Express at 13th and Walnut in
Center City and a Hampton Inn in Exton, Pa., among others.
Source: Philadelphia
Business Journal
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