Oct. 26–FORT WORTH — A hotel developer specializing in historic renovations is eying downtown Fort Worth's Transport Life Building.
Plans are in the early stages for DSG, a Memphis-based developer, to take ownership of the former XTO Energy office building at 714 Main St. The Fort Worth City Council next week will consider $6 million in hotel tax incentives to help make it happen. The project will involve a $56 million investment.
DSG CEO Gary Prosterman said his company is under contract to buy the 24-story building, and details haven't been finalized. The space will accommodate a 232 room, four-star hotel with room for a restaurant, bar and meeting space, according to the city's economic development department.
"We go around the country looking looking for beautiful historic buildings and 714 Main certainly fits the bill," Prosterman said, adding that are no plans to change the facade. "You've got to respect the building's heritage."
DSG's portfolio boasts a number of high-end hotel and apartment redevelopments largely in historic buildings. The company is converting Houston's Melrose Building into a four-star Le Meridien Hotel.
Robert Sturns, the city's head of economic development, said the project makes sense for the former office space. As XTO moves operations to Houston as a ExxonMobil subsidiary, much of the building has become vacant. Custom interiors may make it hard to sell as commercial space, he said.
"Putting it back on the market as office building would be hard," he said.
Downtown has a need for high-quality hotel space, Sturns said. The location near Sundance Square and the Fort Worth Convention Center is also ideal for hotel use, he said.
The city's intensives, capped at $6 million, expire in 10 years and are paid through the 7 percent hotel tax. In that time, the city expects to net nearly $17 million after incentives from growth in hotel, sales and property tax, Sturns said.
Approval of the incentive package is just the first step in the process. About $650,000 will be considered from the downtown tax district to assist with streetscaping and utility upgrades. Historic tax credits may also be sought.
Luke Ranker: 817-390-7747; @lrankerNEWS
