yes, but new to Dallas
Vegas Duo Carves Dallas Niche in Victory's $100M Plan
By Connie Gore
Last updated: Dec 3, 2003 08:07PM
DALLAS-A show-stopping quartet of restaurants and nightclubs has Dallas on the dance card after striking a 15-year lease for Hillwood's Victory, now within 45 days of breaking ground on a $100-million, mixed-use project.
"It was a surprise to have ended up with so many concepts out of one operator," Jonas Woods, president of Hillwood's Victory development, tells GlobeSt.com of the first wave of restaurant/retail announcements to debut since Ross Perot Jr. and team got back full control about four months ago. The new players in town will be Michael Morton and Scott DeGraff, a Las Vegas-based nightlife team with cutting edge concepts now only available at the Palms Casino Resort in their homeport and Chicago.
Woods says the Victory team pursued the duo, which includes the son of famed Chicago restaurateur Arnie Morton, because "they will bring something to Dallas that Dallas doesn't have." And that, Woods says, is a priority in filling the 300,000 sf of retail/restaurant space that will be built in Victory's eight-building development being set on 72 acres with the $420-million American Airlines Center as the anchor.
"We've turned away a lot of deals because they already exist...at various locations in Dallas," Woods says. Hillwood secured an exclusivity clause for Dallas/Fort Worth with the signing for about 45,000 sf in the W Dallas Victory hotel and residences, Woods confides. Street-level space will go to N9ne, a traditional steakhouse, and Belly, an Italian/Mediterranean dining concept to be unveiled first in Palm Springs, CA and then in Dallas. Second-floor space will hold Rain, a nightclub with state-of-the-art special effects and technology, while the 33rd floor penthouse is dedicated to the Ghostbar, an "ultra-lounge" with the glitz and glamour of Vegas that will be tailored to Dallas.
But, Woods stresses, the quartet is just the beginning of what Victory will bring to Dallas. Retail negotiations are underway to fill 180,000 sf and office talks have begun with a dozen prospects, each needing 50,000 sf or more. The plan is to break ground just months apart on the 251-room hotel with 94 condos and a 350,000-sf office building timed to deliver no later than six months apart in late 2005 and 2006. Woods says more retail announcements will be forthcoming after the holiday season ends.
Childhood friends Morton and DeGraff launched N9ne in Chicago and then took the show on the road to Vegas. Besides Victory, the pair also secured space for four venues in the $250-million casino resort hotel being built by the Morongo Band of Mission Indians in Palm Springs.
Victory's retail leasing is being handled by David J. Levine, known in Dallas as the general partner for the West End Marketplace and a founding partner in George Lucas' Entertainment/Retail Development group, and Edward A. de Avila, principal of Core Retail, who steered the 15-block Country Club Plaza in Kansas City, MO, and co-founder of Centertainment Inc., the wholly owned subsidiary of AMC Entertainment Inc. Hillwood's development partners are Southwest Sports Realty, led by Tom Hicks, and Gatehouse Capital Corp., with Marty Collins as the president.
In other news:
-Funding for second Calatrava bridge has been found
-Elaborate painting of the high five has begun. The Columns will basically be color coded by height, with the tallest being a blue green color, the middle heights, and earthy red tone, and the shortest a beige color. All will have a lone star painted in a different color. The artistic patterns on retaining walls will also feature the blue-green of the tall columns. Fibre-optic effects will be used throughout the interchange. Also stated artist were working on unique features on Project Pegasus and I-30.
-Park Lane Place(mixed-use TOD at Park Lane DART station) is beginning construction
-Reserve Tower condo project sign goes up on Woodall Rogers
-Ritz announcing
Condo developers finding links to hotels draw residents, financing
10:36 PM CST on Thursday, November 27, 2003
By STEVE BROWN / The Dallas Morning News
When residents at the Victory project condominiums get the late-night munchies, anything from a snack to a full meal will be a phone call away.
That's because the 80 condos are being planned on top of the W Dallas Victory Hotel and Residences to be built northwest of downtown.
And the project isn't unique.
A few blocks away, on Pearl Street, a combination Ritz-Carlton hotel and condominium building will soon begin advertising residential units.
Developers are selling the idea of combining hotels and condominiums all over the country – and it has as much to do with economics as providing extra service.
"A lot of developers are doing this today, and it makes sense," said Hillwood Capital president Jonas Woods. He said the company hopes to break ground in the next month or so on the W Hotel and Residences.
The tower – with 258 hotel rooms and 80 luxury condos – will be next to American Airlines Center.
Good for everyone
Condo residents will get the kind of services found in a four-star hotel, including maid service, catered meals and use of the spa and concierge.
"The buyer of the condos is willing to pay a premium – in some cases as high as 50 percent over a comparable unit in the same market – because of the availability of hotel services," Mr. Woods said.
But more important, industry analysts say, is that the condominiums allow hotel developers to get financing and break ground at a time when hotel construction is at a virtual standstill.
"What the condos can do is take a marginal hotel project and make it feasible," said John Keeling, a hotel industry analyst for PKF Consulting. "It's very difficult to build full-service hotels.
"The profits from the condo can be used to increase the return on the hotel," Mr. Keeling said.
Hillwood is counting on that with its W Hotel project at Victory.
"Hotels require a lot of equity, and one way to get that equity down is to generate it from the condos, which you can presell," Mr. Woods said.
He said Hillwood has arranged its construction financing for the W Hotel and Residences and has hired general contractor McCarthy Building Cos.
"I think you're going to see this happening more and more in the higher-end, full-service hotels," Mr. Woods said.
Indeed, the next one for Dallas will be at the corner of Pearl Street and McKinney Avenue.
Crescent Real Estate Equities intends to announce its plans in the next few weeks for a Ritz-Carlton Hotel with condominiums to be built across the street from its namesake Crescent complex.
Company officials say they aren't ready to talk about the deal, but construction should begin on the marketing center for the project during the next couple of weeks, brokers familiar with the project say.
And Hotel ZaZa, which is a block away near McKinney and Leonard Street, has cleared a building site where it plans to build condos to join the 146-room hotel that opened last year.
First of its kind
The first such project in Dallas – The Mansion Residences on Turtle Creek – opened in 1994 next to the Mansion on Turtle Creek restaurant and hotel.
Two adjoining condo buildings called the Plaza Turtle Creek also offer services from the Mansion hotel.
Dallas developer Craig Hall – who is currently investing in both hotel and condo projects – lives at the Plaza.
"We have service from the Mansion and thought we would use it more, but we've only done it once," Mr. Hall said. "But having the option is attractive to us.
"From a real estate standpoint, it definitely prices the condos a good bit higher," he said.
So Dallas residents will have several choices in the hotel-condo market.
The question remains, will they buy it?
"There are certainly buyers that would find the prestige of the hotels appealing," said Mike Puls, a local housing analyst with Foley & Puls. "It adds value to the unit.
"And if they can get room service and a massage, that's cool," he said.
But the concept probably won't appeal to every Uptown condo buyer, Mr. Puls said.
"Other people just want to go home and not be annoyed by the comings and goings in the hotel," he said.
Hotel analyst Mr. Keeling agrees.
"Typically these things have separate entrances," he said. "The condo owner doesn't want to mingle with the Lions Club conventioneers in the lobby."
As in most real estate projects, location is also crucial, Mr. Keeling said
"If you are going to do it in a market that makes no sense for condos, it won't matter if it's on top of the hotel," he said.
So far, most of the hotel-condo projects nationwide have paired luxury hotels with pricey condos. But that may change, Mr. Keeling said.
"I think you will see these projects take a step down," he said. "There is some synergy from the two working together."
E-mail stevebrown@dallasnews.com
Though lots of construction never stopped, the real boom looks to have begun
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