An affiliate of Brazilian hotel owner-operators Grupo Atlantico paid $2.4 million on Tuesday to enter Orlando's tourism corridor, buying an entitled 2.35 acres southeast of the former Wet 'n Wild property with plans to develop an independent hotel.
Located at 5871 Carrier Dr., the property was previously approved by the city for a six-story, 157-key hotel, proposed in 2015 with the Element by Westin flag. Preliminary engineered plans for the site were part of the deal.
Based in Santos, a coastal city in Sao Paulo state, Grupo Atlantico owns and operates four hotels under its own family of brands that run the gamut from hostel to full service.
"We had wanted to enter the United States, analyzed different tourism markets and found Orlando to be far and away the best potential for return on a new hotel," director Fabio Rodriguez told GrowthSpotter. "We plan to create a new flag for Orlando as part of Atlantico Group, which could be a (select-service) product with a pool, conference rooms, bar and restaurant."
"What we had here is a Canadian investor that when he bought the site (in 2014) the Canadian dollar was equal to the U.S. dollar. He was planning to build his dream hotel, but his main revenue stream was the oil industry and that sector declined in the past three years," Brenner said.
"He had pre-engineered plans and an (Element by Westin) flag from Starwood, all was ready to go," he continued. "But when the economics for his businesses elsewhere caused him brief hardship, he decided to put the property on the market."
Barakat had more than $100,000 invested in pre-engineering approvals, drawings, soil borings and more, Brenner said.
Michael Goldsmith of Goldsmith Consulting Design Associateshad served as owner's representative and architect previously for Barakat. He's now in negotiations with Grupo Atlantico to stay on the project and lead its transition from the Element flag to an independent.
"They've shown great interest in keeping us on board as architects and design professionals to transition this from a branded project to what will be a stylish Brazilian hotel, which I think will be very interesting for that market," he told GrowthSpotter on Wednesday. "We'll go into the pro-forma programming early next week to figure out how to make those changes."
An early conservative estimate for total project investment is $15 million, said Rodriguez, who expects his group to fully fund with its own equity and not seek a construction loan.
No construction permit had been issued for the project by the city when Barakat was pursuing development. Rodriguez said Atlantico is aiming for a fourth quarter groundbreaking and delivery in 18 months. A local general contractor is already in contract negotiations, he added.
Marketed actively by Brenner since March, he said a question raised by prospective buyers was the viability of the site for a limited service hotel, in such close proximity to Universal's Wet 'n Wild property where the market expects limited service hotel towers to be developed.