UPDATED: MARCH 30, 2016 9:55 AM — New York-based real estate developer and manager Empire Equities is expected to bring Starwood's Le Meridien flag to the Orlando hotel market, if it can close on a 5.34-acre site on Universal Boulevard where it's been approved for a 365-key hotel.
Empire earned Development Plan approval on Nov. 18 from Orange County for a 360-foot, 23-story hotel, to be located north of the Orange County Convention Center's North Concourse, and directly west of the former Westin Hotel on Universal Boulevard.
While the placeholder "Empire Hotel" has been used to identify the project in applications to the county, contractors for Empire left the Le Meridien name on six pages of the 19-page DP filed back in early November.
And in late January, Starwood Hotels & Resorts mentioned in a statement about its North American growth that the Le Meridien flag had a new signing in Orlando on Universal Boulevard, where the only active hotel project is Empire. Starwood confirmed on Wednesday that agreement is still active.
The 5.34-acre tract for the hotel would be subdivided from what is currently a 63.8-acre parcel owned by Orlando Equity Partners (OEP), an affiliate of Southwood Development Company in Atlanta.
Sources in Orlando hotel development told GrowthSpotter on Tuesday the project is expected to carry the Le Meridien flag, negotiations continue with OEP for the land, and Empire is trying to solidify the financing in its capital stack to complete the purchase.
Dovi Lesches, partner at Empire Equities, declined to comment Tuesday for this story. Calls to Southwood Development Company were not returned.
After the November approval of Empire's hotel DP, Orlando Equity Partners platted the land on Dec. 3, with the hotel's DP to occupy a small portion of Lot 1 on that plat.
A building permit application for the hotel's site work was filed on Dec. 7, and remains under review by Orange County's Building Department. Deficiencies remain for the applicant in areas like zoning, utilities, fire and landscaping review. The permit application window could expire June 7.
The Greater Orlando market boasted 68 individual hotel transactions in 2015, with single asset sales totaling $595 million in value -- more than the previous two years combined. Despite economy and debt market questions, Orlando can draw more hotel investment than ever, said Paul Sexton of HREC Investment Advisors.
Designated as an "upper upscale" brand by most hotel lodging analysts, Le Meridien's entry to Orlando would follow the growth of this luxury segment after recent success locally for properties like the Ritz Carlton, JW Marriott and Four Seasons.
"It's not surprising that a developer out there would pursue this flag for Orlando. We've seen we have a luxury market here with the success in recent years of other upper upscale brands," said Paul Sexton, vice president of HREC Investment Advisors, a national brokerage offering consulting, development and asset management services to the hotel industry.
The failure of the Westin hotel on Universal Boulevard, which was sold last December to Hilton for conversion to timeshares, was due to its isolation with few walkable amenities nearby. Universal Boulevard is now primed for mixed use development.
"Now that area is no longer held by a single landowner without the financial ability to build everything out," Sexton said. "In Orlando you need dining and attraction amenities nearby for (a hotel) to thrive. This area now has that potential."