Division Hotel Management LLC, in partnership with Valencia Hotel Group, plans to demolish the former Caravan Motel at 908 E. Division St.
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An independent hotel management company wants to transform a former motel and used car dealership in Arlington into a $54 million luxury hotel, and the city is providing funding to support the project.
Division Hotel Management LLC, in partnership with Valencia Hotel Group, plans to demolish the former Caravan Motel at 908 E. Division St. and Dollar Car Sales buildings at 900 E. Division St. and build a 145-room independent hotel called Caravan Court on the 2.6-acre site.
The existing property is valued at more than $1.6 million, according to the city. Marty Wieder, executive director of the Arlington Economic Development Corporation, said the hotel would cost $54 million to build, up from a previous estimate of $45 million.
On June 25, the Arlington City Council unanimously voted to provide $4 million to support the hotel development: $3 million for demolition costs and $1 million for development assistance. The agreement also provides for performance-based discounts. No one on the council spoke against the incentives or the development.
The boutique hotel would generate $13 million in economic impact for the city over the 15-year life of the agreement, as well as new tax revenue from hotel occupancy taxes, property taxes and sales taxes. Demolition must occur by Sept. 30, and the hotel must be developed by Dec. 31, 2026.
One oddity about the incentives is that the agreement requires the hotel to be operated by Citrus Hotels LLC under the brand name Valencia, but it cannot use any place name other than Arlington to describe the hotel’s location.
Caravan Court will be designed with an updated “motor court” concept incorporating midcentury design, and plans call for the reuse of the signage from the historic Caravan Motor Hotel, which is located on the site, according to a city report.
Arlington City Manager Trey Yelverton said the old Caravan Motel has fallen into disrepair, and he hopes the new hotel will start a domino effect that will spur more development in the area.
“It had its heyday a long time ago, but it hasn’t been like that in recent years,” Yelverton said during a presentation to the City Council on June 25. “Now is the time to inspire change.”
The city has been trying for more than 20 years to redevelop the Division Street corridor where the former motel is located, and one of the goals of the city’s Division Street Corridor Plan, created in 2000, was to attract new restaurants, shops and upscale entertainment venues to the street.
Fourth District Councilman Andrew Piell said he is excited about the project.
“Division Street is ugly,” he said, “and cracking the core of Division Street to revitalize and redevelop it has been the great white whale the city has been chasing for 25 to 30 years. Finally, we have a legitimate, well-funded, quality product, and we hope that over time this will be the start of a new redevelopment of Division Street.”
Yelverton said Sam Marouk’s Marouk Enterprises International Inc. owns the land where the new hotel will be built. Marouk also owns several properties along Division Street, according to a city release about the hotel development. The city approved a $7 million grant for Marouk’s company, Icon Technologies, to keep the business in the city in exchange for other conditions, including identifying opportunities to revitalize Division Street.
