Developer JBG Cos. of Chevy Chase is negotiating to buy the city's largest hotel -- the Marriott Wardman Park at 2660 Woodley Road NW -- for more than $200 million and may turn some of the hotel rooms into condominiums, according to several sources close to the deal.
Though it is not final, the deal is expected to close by the end of the year, said the sources, who are familiar with the negotiations and requested anonymity because the talks are confidential.
Benjamin R. Jacobs, a partner and one of the founders of JBG, returned a reporter's call yesterday but would not say anything about the project. JBG is known as one of the biggest developers of office, housing and retail in the region.
Wardman Park is one of the 14 District hotels in a contract dispute with a unionized workforce.
Regardless of changes if it is sold, some of the gardens and parts of its facade are considered historic and would not be destroyed. However the site is approved to hold more buildings, according to other real estate brokers.
In 1998, Thayer Lodging Group Inc., an Annapolis investment firm headed by former Marriott International Inc. senior executives Frederic V. Malek and Leland C. Pillsbury, bought the hotel from John Hancock Mutual Life Insurance Co. Thayer paid $227 million for the 1,348-room hotel, then called the Sheraton Washington.
Thayer spent $100 million renovating the hotel, which was built in the 1920s, and hired Marriott International Inc. to run it. After Sept. 11, 2001, the hotel suffered losses when the number of visitors to the District dropped. Marriott laid off dozens of housekeepers, cooks and front desk clerks but has since hired them back.
The potential sale comes as hotels are making a slow comeback to profitability and the condo market is hot with buyers willing to pay high prices for units, real estate experts said. D.C. developer Monument Realty LLC recently bought the Watergate Hotel and plans to turn it into high-end co-op units.
The Wardman Park hotel is likely to face increased competition, as the city plans to build another major hotel next to the new convention center at Mount Vernon Square NW. City officials have proposed building a convention "headquarters" hotel with as many as 1,200 rooms at a site in the 900 block of Massachusetts Avenue NW that is owned by local developer Kingdon Gould III. Marriott would run that hotel, also.