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Westin wants to be first

Luxury hotel planned

By DUDLEY PRICE, Staff Writer

The former Sheraton Hotel at Crabtree Valley Mall is about to get a $30 million makeover that will give Raleigh its first luxury hotel.

Sanjay Mundra, chief executive of First American Hotels in Cary, and Dicky S. Walia, who operates Welcome Holdings in Raleigh, will announce today that they will open the hotel as a Westin franchise in the summer of 2005.

planned hotels

Four possible luxury hotels are being considered for the Triangle, with hopes of earning a rating of a four or five from Mobil or AAA. They are:

* THE WESTIN AT CRABTREE VALLEY: A 225-room hotel with a heated outdoor pool and fitness spa. Rooms will have 42-inch plasma TVs, goose-down bedding and oversize baths. Room rates of $150 to $200 a night are expected.

* THE UMSTEAD: A 151-room hotel with a 12,000-square-foot spa at Cary's Arboretum. The hotel could cost as much as $70 million.

* AN UNNAMED HOTEL: Quaintance-Weaver Restaurants and Hotels, owner of the O. Henry Hotel in Greensboro, is considering a $30 million hotel at the former Koger Office Center on Glenwood Avenue.

* AN UNNAMED HOTEL: John Kane, who is redeveloping the former North Hills Mall at Six Forks Road and the Beltline, said he is in negotiations with developers for a luxury hotel at the site and will have an announcement in 90 days.

hotel ratings

Star ratings are awarded by Mobil Travel Guide, and diamond ratings are given by the American Automobile Association. Five stars or five diamonds is the highest rating a hotel can receive.

In the months in between, the hotel will undergo a complete overhaul with the goal of earning a coveted four-diamond rating from the Automobile Association of America or a four-star rating from the Mobil Travel Guide.

Today's announcement could touch off a race to be Raleigh's first four-diamond hotel. Quaintance-Weaver Restaurants and Hotels of Greensboro, which owns the O. Henry Hotel in Greensboro, is considering building a hotel just down Glenwood Avenue at the former Koger Office Center that could earn the distinction. John Kane, who is redeveloping the former North Hills Mall, also is negotiating with developers for a luxury hotel.

And in Cary, Ann Goodnight, wife of SAS Institute co-founder Jim Goodnight, is planning a $70 million hotel that could qualify for five stars when finished.

The only full-service Triangle hotels that now have a four-diamond rating are the Carolina Inn and the Siena Hotel in Chapel Hill and the Washington Duke Inn & Golf Club in Durham. The Fearrington House in Chatham County has a five-star rating as a country inn.

"We live here, our families go to school here. Having the nicest hotel in town is important to us," Mundra said.

The partners are planning amenities such as 42-inch plasma televisions, goose-down comforters and oversize bathrooms with separate tubs and walk-in shower stalls.

Rooms also will be much larger than the Sheraton's. Originally the hotel had 315 rooms; the new hotel will have 225. Every three rooms will be combined to form two rooms, increasing the total space in each to 468 square feet.

In addition, the partners plan a fitness spa, heated outdoor pool and shops. They also said they have a letter of intent from one of the country's top five restaurants but declined to name which one. The amenities won't come cheap. Room rates of $150 to $200 a night are anticipated. The average Wake County room rate last year was $65.49, according to the Greater Raleigh Convention and Visitors Bureau.


"Westin wanted to make sure it was a four-diamond and signed up with us," Walia said. The Westin flag is a brand offered by Starwood Hotels and Resorts, based in White Plains, N.Y. The only other Westin in North Carolina is a 700-room hotel that opened last year in Charlotte. Nationally, there are 63 Westins.

The renovation would be a remarkable turnaround for the old lodge that was the first Sheraton Hotel in North Carolina when it was built in 1973 by former Raleigh mayor Seby Jones. The hotel was the inn of choice for thousands of guests through the early 1990s. Jones, who died in 2002, even maintained a 3,000-square-foot condominium for himself atop the hotel.

But upkeep waned, and the hotel was downgraded to a Four Points by Sheraton and later became a Clarion. Providian Life and Health Insurance, a division of Dutch insurer Aegon, closed the hotel in September as part of a foreclosure procedure, and the partners bought it for about $5 million. The former operator, Raleigh-based Davidson and Jones, had considered a $1.25 million renovation in 2002, but shelved those plans as the hotel industry suffered through overbuilding and sagging occupancy.

Other hotel developers looked at the hotel but decided to pass. But Mundra and Walia determined that by demolishing all of the hotel except the supporting columns, the cost of building each room would be about $100,000. Building a new Westin from scratch would cost as much as $225,000 per room, they said.

Limited market

Mundra wants the building to be completed before any potential competition. In Raleigh, "the market is ready for one, but maybe not two," he said. Kane and Dennis Quaintance said the Westin at Crabtree won't affect their plans.

Mundra and Walia have bought other distressed hotels. In 2001, Mundra's company bought a 200-room Holiday Inn in Fayetteville for $4 million, he said. In 1998, First American bought a Sheraton Grand hotel in New Bern for $8 million.

The partners also own a Hilton Garden Inn in Hilton Head, S.C., a Holiday Inn on the Billy Graham Parkway in Charlotte, Hampton Inns in Henderson and Havelock, a Quality Inn in Lexington and a Microtel Inn & Suites in Raleigh.



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In next weeks Triangle Business Journal, the former Four points Sheraton that was supposed to be remodeled into a 4 or 5 star Westin Hotel. We now be torn down and replaced with a brand new structure.

After running into structural problems with the old structure developers now wish to demolish the existing structure and build a-new Luxury highrise with condominiums on top of the hotel rooms. Look for renderings of this hotel in mid-May. Work should begin later this summer and x-pect to see the finished project in 2007, about the same time the 4 1/2 star Rennaisance Hotel will be finished at North Hills. And work well under way at the Marriott Hotel Downtown at the new convention center.

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You make a good point, Raleigh is no Atlanta, but then why would we want to be an Atlanta. I think the Westin is trying to make Crabtree an entertainment district. Dont get me wrong I am not trying to pull proposals out of downtown, but Raleigh cannot focus itself on just its downtown, it needs a variety of places to converge upon. Hence North Hills and Triangle town Center, or Walnut Creek. Think of what downtown would be had we focused all of this into it. It would be a disaster.

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orulz, I really see where you're coming from on this, but I have to disagree somewhat.

I agree that the Westin may be a bit of a stretch for the museum-going family and Crabtree Valley may seem less spectacular to a city dewller, but I think the general location strategy that Westin is using is sound.

Modern cities are very rarely solely about what's downtown, sad to say. They are about the region and regional attractions. Most of the out-of-town travellers that would chose an upscale hotel like the Westin are viewing Raleigh-Durham as a whole, and not as individual cities, charming as those cities are.

The Glenwood Avenue area at the Beltline is the nerve center for the regional trasportation system and is close to any number of offices and businesses, as well as the Research Triangle Park and downtowns in both Durham and Raleigh. Add to this the high visbility of the location, and proximity to a number of stores and restaurants (including Glenwood South) and you have the 'perfect storm.'

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Where is the news story in the TBJ that you refer to? Starwood is very big right now in mixed use projects...hotels and residential combinations (Dallas Victory Center, Princeville Resort, etc). This would be very good news for Raleigh. A new Westin Hotel (built from the ground up) would be much better than rennovating the existing structure.

For those of you who think that the location isn't good, look at what's happened at the "new" North Hills. There's more activity there than anywhere else in the city right now. Crabtree will continue to be a draw for years to come.

Business travelers to RTP complain all the time about not having a "luxury" choice in the park. They also complain about not having anything to do while in RTP. A Westin hotel would give them retail choices (doesn't matter what their used to...) being across from the mall, great dining options (there's supposedly going to be a Morton's steakhouse built next to the hotel) and proximity to RTP (15 minute drive).

The residential units would also command high prices given the popularity of the North Hills units.

I really don't see a negative to this deal.

Again, if anyone has the news article...can you post it?

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