COVER STORY, JULY 2007

THE SECOND TIME AROUND
Redevelopment projects revive properties, refresh appeal.
Brian A. Lee

Developers across the West are reviving old or degraded properties into places people want to be. Their first impressions of these second-chance developments will be based on renewed offerings and fresh appeal but at the same old likeable locations.

Montage

Montage resort in Park City, Utah

In creating the Montage resort in Park City, Utah, an established western resort developer will take part in the first Environmentally Responsible Redevelopment and Reuse (ER3) project in the nation. Guests and residents will soon be able to ski out from the green property to the white slopes of the adjacent Deer Valley Resort.

Thanks in part to the EPA’s pilot effort to remove liability obstacles in encouraging environmentally beneficial redevelopment projects, The Athens Group will transform the once-contaminated Daly West Mine site and recent mineral waste dump, located in the ski town’s Empire Pass community, into a LEED-certified (Leadership in Energy and Environmental Design) resort and spa facility. The Montage resort will feature 178 hotel rooms and suites, 94 luxury residences, two restaurants, retail shops, a 35,000-square-foot spa, and 15,000 square feet of event/meeting space.

“The blending of the mountain lodge craftsman style architecture with the spectacular Deer Valley Resort mountain setting and surrounding forest environment will be dramatic and memorable,” says Jeff Mongan, senior vice president at Phoenix-based The Athens Group. “Montage creates memorable lifestyle experiences for families and active, affluent travelers and homeowners.”

In 2004, The Athens Group purchased the property from Talisker Corporation, whose affiliate, United Park City Mines, completed the environmental remediation of the site. The project received the ER3 designation in April, and construction started in June. The luxury resort hotel and residential property — owned by DV Luxury Resort LLC, a partnership of The Athens Group, operator Montage Hotels & Resorts and a group of private investors — is slated for completion in summer 2010.

“One of the biggest challenges is the logistics of building a major construction project near the top of the mountain with the relatively short summer construction season,” says Mongan. “That forces the majority of the construction to be performed through multiple winters and stretches the construction duration to 3 years.”

Mongan says that the Montage resort will complement both Park City’s positioning as one of the premier resort destinations in the country and the city’s commitment to being one of the leading sustainable communities.

“This is a great example of the types of cleanup outcomes that the EPA is increasingly striving to achieve — one where we not only remove environmental risks, but where we work with local interests to create a productive community asset,” says Robert Roberts, an EPA regional administrator.

As an ER3 participant, Montage’s owners will incorporate extensive green features into the development, including a 750-block wind energy purchase through Utah’s Blue Sky partnership; a 2,800-acre open space easement; use of native vegetation; a constructed wetland and groundwater treatment system; and the use of chlorine alternatives for resort pools and spas.

Hotel Palomar

Behringer Harvard has found a golden redevelopment opportunity on the “Golden Mile” in West Los Angeles. Through its Strategic Opportunity Fund I LP, the Addison, Texas-based investment company acquired the Doubletree Hotel Los Angeles-Westwood in 2006 and is currently repositioning it into a hospitality jewel in the city’s high-demand west side.

“When visiting the redeveloped hotel in Westwood, guests will first notice upgraded and newly sophisticated common areas and an enhanced package of amenities for their stay,” says Jason Mattox, executive vice president for Behringer Harvard. “This urban resort property will boast fully remodeled guest rooms, expanded fitness facilities, enhancement of the pool and lounge area, and a four-star restaurant.”

When completed, the 18-floor luxury boutique hotel will feature approximately 260 guest rooms and suites and be called Hotel Palomar, one of the signature styles of San Francisco-based Kimpton Hotels & Restaurants Group, which will manage the property.

“The sophistication and unique offerings of the Kimpton Hotels & Restaurants Group will make this hotel a destination urban resort within this market,” says Mattox.

While the hotel will benefit from the submarket’s desirability and high barriers to entry, guests at the Wilshire Boulevard address will have great access to so many of Los Angeles’ attractions, including Rodeo Drive, Hollywood, the Sunset Strip and the beautiful Santa Monica beaches. Commercial clientele will be well served by the hotel’s close proximity to major office complexes and the UCLA campus.

Presidio apartments

Forest City's $90 million apartment redevelopment in San Francisco will begin in 2008.

The Presidio Trust — superintendent of the Presidio of San Francisco, the historic former army base and current national park located at the foot of the Golden Gate Bridge — has entrusted Forest City Enterprises with the redevelopment of its Public Health Services Hospital into a 161-unit apartment community.

“The Presidio is a national treasure, an ideal project for Forest City to use our adaptive re-use/historic preservation experience,” says Susan Smartt, senior vice president at Forest City in San Francisco. “By restoring historic landmarks and converting them into vibrant housing and neighborhoods, we are helping to preserve America’s heritage.”

The public/private partnership will start the $90 million redevelopment project in second quarter 2008, with completion slated for 2 years later. The hospital site’s historic buildings will be rehabilitated, and the other wings will be removed to make way for new construction. Using sustainable practices and materials, Forest City will seek silver LEED certification for the repositioned Presidio property.

“Many hours of community meetings were held with residents in the surrounding neighborhood to develop a plan that addressed traffic, safety and environmental concerns of the surrounding community,” says Smartt.

The Presidio Trust, which was established in 1996 to manage the expansive property, initially requested proposals for this redevelopment project in 2003. The main hospital was closed in 1981.


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