Old Hotels Can Rise out of the Ashes

One way to pump new life into old hotels is to turn them into something else.

The $12 million transformation of the six-story Fayetteville Mountain Inn into a 10-story Crowne Plaza hotel has been bogged down for several months. But apparently, that’s about to change.

“All of the bid contracts are in, the final architectural drawings are in and we’ve received commitment for financing but have not yet closed on the deal,” said John Nock, investment banker for Stella Moga of Westlake, Ohio, who owns the hotel. “It’s a work in progress.”

The fate of the four-story, 12,316-SF County Courts building next door, however, is still up in the air. Moga agreed last year to buy that building from Washington County for $600,000, but after September 11, the deal has been on hold. Nock said the Crowne Plaza project will go forward with or without the courts building.

“They’re planning to incorporate it into the design,” he said. “It would be planned amenities, but it’s not part of the hotel proper.”

When finished, the Mountain Inn will have 125 rooms, including 20 luxury suites. It will have 12 luxury condominium units on the top two floors and retail space on ground level.

The condos range from 2,000-2,400-SF in size.

“We’ve already had strong interest from qualified buyers regarding the condos,” he said.

The Mountain Inn was a deteriorating downtown hotel in need of renovations when Moga bought it for $975,000 in June 2000.

The historic inn has endured several names, remodeling projects, owners, functions and at least two bankruptcies since it was built in the late 1800s.

“It’s had a very colorful past,” said Richard Alexander, a Fayetteville developer of historic buildings and consultant to Moga. “The Teamsters Union even had it for a while, but I don’t know what they used it for.”

Called the Mountain House when it was built, its name changed to the Oriental in the early 1900s.

In 1923, a dining room and coffee shop were added. It was remodeled again in 1929 to include office space on the first floor.

The building was vacant from 1960 to 1980, when a group of Fayetteville investors bought the building and restored it.

After $1 million and two years of work, the building reopened as the Mountain Inn. The refurbished hotel had a restaurant, a banquet hall, a bar, a swimming pool, a six-level parking deck and retail space on the ground level facing the street. Rooms on the top floor offered a panoramic view of the Ozarks.

It served as a hotel until 1994 when the owners filed for bankruptcy.

Moga purchased the building from the Maharishi Vedic University, which bought the building in 1995 and used it for transcendental meditation classes. Maharishi Vedic University was founded by the Maharishi Mahesh Yogi, a Hindu religious leader who in 1978 claimed he could levitate.

Little Rock Inn

Planners and developers are looking at new uses for The Little Rock Inn at 601 Center St. in the state capital.

“The thing about the Little Rock Inn is that it was no longer functioning well as a hotel,” said George Wittenberg, architect and director of the Center for Urban Studies and Design at the University of Arkansas at Little Rock. “It was holding back development in the area.”

Wittenberg is under contract with the Little Rock Downtown Partnership to provide planning and design services for downtown development projects, including the Little Rock Inn.

Built in 1961, the hapless former motor lodge had become notorious in recent years for drug deals, prostitution and other shady activities.

Business and city leaders bestowed colorful labels on it, including “poster child for urban blight,” “canker sore of a building,” “public nuisance,” “nest of roaches,” “crime magnet” and “cesspool.”

In October 1997, after two years of surveillance, prosecutors finally gathered enough evidence to convince Pulaski County Judge Vann Smith to shut it down. Among court testimony was a police videotape showing repeated drug deals by a regular hotel occupant known as “Sleepy.”

In other testimony, business owners complained of solicitations from prostitutes working out of the inn.

The hotel was closed for a second time by court order in June of this year after neighbors and police complained that it had again become a haven for drugs and prostitution.

Allright Parking, which owns the hotel, is looking for developers and options for alternative uses. But it may be a hard sell. The Catholic Diocese of Little Rock, located across the street, owns the land on which the hotel stands. Its lease agreement with Allright expires in 2011, after which the church might opt to do something else with the property.

Demolition is an option, albeit an expensive one.

“A while back we received an estimate of $300,000 to demolish the building,” said T. Martin Davis, attorney for Allright.

Hank Kelley, a Little Rock developer, said he would be interested in being involved in a new development for the Little Rock Inn but only if a more favorable lease agreement could be arranged.

Little Rock developer Bob Francis agreed, saying, “a developer who puts $3-4 million into a project is going to want to purchase the land, not have a lease.”

Dennis Lee, chancellor for diocese administrative affairs, said no one has approached church officials about the property, but potential developers would first have to work out an arrangement with Allright for the remaining period of the lease.

“We have not marketed it as being for sale, but if there’s something someone wants to do to improve the area, we’re open to it,” he said.

Meanwhile, Wittenberg is working on a design that calls for converting the five-story Little Rock Inn into residential housing. Wittenberg envisions the remaining three-quarters of the block as raised green space.

“We’re in a very early stage of combining design with financial analysis to provide us with the development feasibility of the site,” Wittenberg said. “This will give developers an idea of what can be done.”