The In Place

Renovation Converts Former Hilton Site to Hotel Palomar

by Lesley Hensell

A rendering shows Dallas’ Hotel Palomar and the Residences at Hotel Palomar, a $90 million renovation and new mixed-use development project, at Mockingbird Lane and Central Expressway.

Even with an ever-increasing population, vibrant retail market and more restaurants per capita than New York City, Dallas has never garnered a reputation as a cosmopolitan, 24-hour city with exciting apartment living options.

Until now.

Mixed-use urban developments with an upscale feel have begun springing up all around Dallas. The latest addition is the Hotel Palomar, a $90 million renovation and new development project that will include a four-star hotel, high-rise luxury condominiums, retail space and restaurants.

Hotel Palomar got its start as the Mockingbird Hilton, a nine-story hotel built on 5.4 acres in 1967. The building might be best remembered by locals as the former home to Trader Vic's restaurant.

While the Hilton has remained a Dallas landmark for nearly four decades, it lost its luster years ago. But the new development already has seen brisk buying activity, even though doors are not set to open until June. When complete, the entire project will span nearly 450,000 sq. ft.

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High density, high living

Meanwhile, in Uptown, strong sales at the W Dallas Victory Hotel & Residences and at the Residences at the Ritz Carlton prove that Dallas is ready for condominiums with high-end hotel services.

"Dallas has trailed other metro areas in demand for high-end, high-density urban living," said Kip Sowden, principal for Realty America Group, which owns the Palomar project along with Behringer Harvard Funds. "I think Dallas is now becoming more cosmopolitan and there is certainly a tremendous amount of this type of construction going on throughout the area. Once you see the vertical penetration catch hold, you'll be seeing more demand."

The existing Hilton, which sits at Mockingbird Lane and Central Expressway, featured a single hotel tower. That tower is being converted into a 192-room lifestyle hotel, while a new nine-story tower is being constructed to house the condominiums.

A rendering shows a view from the condos of the courtyard where, in addition to the swimming pool, the old and new structures mesh together.

The Residences at Hotel Palomar will add more than 70 high-end apartment homes to the market, including luxury penthouses and contemporary loft-style condominiums. Residents will have access to the services of the hotel next door.

One-, two- and three-bedroom floor plans range in size from 900 to nearly 3,000 sq. ft., while penthouse spaces run to 5,000 sq. ft. Sales prices vary between $300,000 and $1.6 million. Condominiums have been designed to include large terraces, expansive windows with views and high-end finish-out.

More adjacent land has been reserved next to the project for a possible third tower, which would house more residences, Sowden said.

The hotel will be managed by Kimpton Hotels & Resorts, a San Francisco-based company that operates independent lifestyle hotels around the country. The hotel will include a full-service spa, swimming pool, restaurant and lounge. In addition to 25,000 sq. ft. of retail space, the ground floor of the development will once again be home to a Dallas franchise of Trader Vic's.

"Dallasites familiar with Kimpton Hotels know that Bill Kimpton is credited for starting the boutique hotel movement-along with the incredible level of guest services-in 1981 when he opened his first hotel in San Francisco," said Dallas City Council member Veletta Forsythe-Lill. "With each of its 40 hotels original in concept and design, it is exciting that Texas is getting its first Kimpton Hotel in Dallas."

Reinventing a landmark

When Walton Construction was brought on board as the project's general contractor, the firm's first job was to recommend ways to seamlessly tie together the old and new towers, as well as the public spaces, said David Clowers, managing director of the Dallas division of Walton Construction.

"There is a big courtyard that essentially meshes the two buildings together," Clowers said. "That's the heart of the development."

The fast-track project got its start in May 2005 with renovation of the existing hotel tower.

"The plant itself was in excellent condition, with the foundations and structure in great shape," Sowden said. "We took it back to the concrete and frame foundation. You simply couldn't build something of the same quality today for a reasonable price."

Starting at the top of the tower's nine floors, asbestos was removed one level at a time. Each floor was encapsulated to prevent harmful materials from escaping. Immediately after abatement, the demolition team came in and gutted the floor. The entire process took about 90 days, Clowers said.

"It was definitely easier and more cost-effective to gut the entire building, rather than try and remove the asbestos in a piece-meal fashion," Clowers said.

New wall partitions as well as a new roof were installed for the hotel tower. The exterior brick was cleaned by a restoration company, while energy-efficient glass was installed in the windows.

Meanwhile, serious work was under way to ensure the building could handle the heavier loads of the condominium tower. This was particularly important over the existing underground parking garage, Clowers said.

"The loads on those columns were originally designed to only handle the roof of the garage," he said. "But we're adding three stories of concrete on top of that. We had to cut holes in the top of the pre-existing garage and bring the columns up from the basement. We also had to stiffen some of the existing columns and piers."

Like the majority of residential construction, the Residences at Hotel Palomar will allow owners to customize their spaces. Buyers can make upgrades to everything from carpet and cabinets to wall colors and drawer pulls.

He then charged Stendebach with the task of creating a viable adaptive reuse plan for the building.

"We spent about a year and a half trying to figure out what to do with it," Stendebach said, adding that he talked with local convention and visitors bureau and hotel concierges to determine what was missing along the River Walk. "It's easy to measure space, but coming up with a business plan is difficult."

Eventually, his research showed there was a need for an entertainment venue that appealed to all age groups.

But the theater, which is listed on the National Register of Historic Places, was encumbered by restrictive deed covenants that had been placed on the building by the previous owner, the San Antonio Conservation Society. The covenants required that any reuse or renovation of the building would have to include refurbishment of the building's original features such as plaster, balconies and tile.

Because the theater had gone through some major modifications during its lifetime, it was hard to distinguish what was original. "We had to do a lot of research to see what the theater looked like when it opened in the 1920s," Stendebach said. In its heyday, the building, which is located at North St. Mary's and Commerce streets, featured plaster sculptures, elaborate furnishings, massive columns and murals with vibrant colors depicting ancient Aztec culture.

The Sept. 11 terrorist attacks occurred before Euro-Alamo Management could move forward with the project, and that meant "we were just stuck with no money to go forward," Stendebach said.

The cash crunch was resolved in late-2003 when Cape Girardeau, Mo.-based Drury Southwest Inc. agreed to purchase the bank building, a Class B high-rise built in 1929, and to tackle the renovation work on the theater.

"With our past experience, we thought we would be a great firm to oversee the restoration of the Aztec," said Kevin Whitfield, branch manager for Drury Southwest's San Antonio division.

The family-owned firm had plenty of experience in renovation and restoration of historic properties after making the historic Petroleum Commerce Building in San Antonio into the Drury Inn & Suites - Riverwalk. Through its restoration work, Drury Southwest came into contact with a number of historical preservation specialists that were eager to take on the challenge of restoring the Aztec to its former magnificence.

Extensive exterior and interior work was necessary, namely removing the street-level granite that had been put up on the building's brick exterior during the 1950s. Drury Southwest was able to locate Ash Masonry, the factory that manufactured the original brick, and Ash then reproduced the same color and quality brick to reface the building. The wooden windows were removed and stripped of all paint and grime. Fresh wood replaced the rotted sections.

After spending about $500,000 on the removal of pigeon guano and asbestos, the historic structure was modernized with all new plumbing and electric, as well as an HVAC system.

Then there was the paint and plaster restoration.

Drury Southwest called upon local paint contractor Restoration Associates to painstakingly remove layer upon layer of paint, color analyze it and repaint the interior with the original colors. The firm, which is well-known for its work on the Alamo, was also able to recreate the same patterns in the paint.

Another local firm, Battersby Plaster, worked to replicate entire sections of plaster that had been destroyed over the years through modernization or vandalism. As the foremost expert on ornamental plaster, Battersby reproduced in plaster the giant "stone" blocks, urns and Aztec-mask wall sconces. Additionally, the original two-story iron chandelier that hung in the lobby was refurbished by Ted Voss, the grandson of the original designer, German immigrant Theo Voss.

The key piece of the project, however, was connecting the theater to the River Walk, Stendebach said. Previously, the Aztec was oriented with its back toward the river, and Crockett Street separated the street-level building from the River Walk.

The basement of the building has been replaced by a River Walk level entrance and an Iron Cactus Mexican Grill & Margarita Bar.

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