Dow adds two full-service hotels; looks to broaden portfolio with larger resorts

SEATTLE— Dow Hotel Company, LLC, based here, is seeking to grow its portfolio, while also expanding the types of hotels it acquires. After acquiring two more hotels last month, the company also has its sights set on purchasing larger hotels and delving into the resort segment as well. Founded in 1997, owner/operator Dow Hotel Co. currently has a portfolio of 10 hotels, two of which were acquired just last month— almost simultaneously. “Sometimes we’re working on three to four deals and we don’t get any. This was the opposite, they both came about at the same time,” said Murray Dow, founder/ president, Dow Hotel Co. The two hotels, the Doubletree Hotel Chicago-O’Hare Rosemont in Rosemont, IL and the Radisson Hill Country Resort & Spa in San Antonio, TX, were acquired within just a week of each other. Double the opportunity The first hotel, the 369-room Doubletree Hotel Chicago-O’Hare Rosemont was purchased in a joint venture between Dow and Prudential Insurance Company of America from Lowe Enterprises. Dow noted the hotel, which is located near the Donald E. Stephens Convention Center, was particularly a good fit for the company. “We run the Embassy Suites right across the street so obviously the Doubletree held a lot of appeal,” he said. “It is a great opportunity to create synergies between the two hotels in terms of operating efficiency. Plus, since both are part of the Hilton family, there is a great deal of potential for marketing to large groups— the two hotels together offer about 700 rooms.” The Doubletree Hotel Chicago-O’Hare Rosemont, which recently completed a renovation of its guestrooms, will remain under the Doubletree flag, according to Dow. The hotel will also undergo a multi-million renovation that will be overseen by Dow Hotel Co. and will include a complete refurbishment and reconception of its restaurant. On the heels of the Doubletree acquisition, Dow Hotel Co. purchased the 227-room Radisson Hill Country Resort & Spa, again as part of a JV between the company and Prudential. “The hotel was only built in 2002, so it’s in very good shape and in a great setting within a growing area of San Antonio,” said Dow. “With the quality of the hotel, there’s a lot of potential.” Dow Hotel Co. is currently examining how to further enhance the full-service resort and spa. With the two acquisitions complete, the company is now looking to branch out by acquiring larger, higher-end hotels and also considering entering the resort market. “Traditionally, we’ve purchased full-service hotels that have between 250 to 500 rooms and fall under the Marriott, Hilton or Sheraton brands,” said Dow, adding the company’s hotels are located all over the U.S., primarily in urban or airport destinations. “Now we’re looking to grow in size and complexity.” Dow Hotel Co. is seeking to add larger hotels to its portfolio and Dow noted brands such as InterContinental, Westin, Regent and Le Méridien are currently at the top of the company’s list. “We’re looking to grow from hotels that do about $10 million in sales to hotels that are closer to $20 million in sales so we want to move up on the full-service ladder,” Dow said. Although the company has not yet pinpointed any particular locations, Dow reported it is looking all over the U.S. for potential acquisitions. “We like the West Coast and we’re not yet in markets like Denver and Phoenix, AZ and we would like to be. We also like the Midwest. It really depends upon the particular hotel and the opportunity,” he said. On the resort side, Dow Hotel Co. is targeting properties with 350 to 500 rooms. “We think we can find a little niche with the smaller resorts. The major hotel companies already have their big resorts, but there are a lot of smaller properties that are not as professionally managed and could use an upgrade,” said Dow. “That’s a great opportunity for a company our size to come in and renovate and reflag them.” Dow typically aquires hotels with a five-year hol