Arlington Hotel sold for 25 percent less than market value – Hot Springs Sentinel

The nine parcels involved in Monday's sale of the Arlington Resort Hotel & Spa sold for $5,031,251, or 25 percent less than their total appraised value.

A deed filed Monday showed the Arlington Hotel Co. Inc. sold the four parcels constituting the 478-room hotel to Sky Capital Group LP of San Antonio, Texas, for $4,856,251. The adjacent Wade Building was sold to Sky Wade Building LLC for $75,000, and four nearby parking lot parcels to Sky Southwest Parking LLC for $100,000.

All three purchasing parties listed the same San Antonio address and were incorporated last month by Al Rajabi, who, according to a news release announcing the sale, is the CEO of Sky Capital Group.

Garland County's contract appraisal service valued the four hotel parcels at $5,343,000 and the Wade Building at $411,000. The four other parcels involved in the sale have a total appraised value of $1,111,550. The Garland County Equalization Board lowered the value of the hotel parcels from $8.07 million to $5.34 million after the company appealed the county's contract service appraisal in 2015.

Monday's sale did not include the Hot Springs Golf and Country Club Association, which has the same owners as the Arlington Hotel Co.

Mike Scott, the city of Hot Springs' chief building official, said Tuesday that after a buyer had been secured the Arlington's ownership stopped making repairs to comply with the notice of unsafe conditions the city issued in June 2016.

Scott said some of the property's roofs were repaired, and the wooden pool deck was removed. Last year's notice said the deck's bracing was rotted. Scott said the deck has been replaced by metal bridges leading to the concrete patio around the pool.

Scott said he's told the new ownership that exterior problems identified in the notice need to be remedied before winter.

"We agreed the exterior of the building needs to be worked on pretty quickly," he said. "I'd like to see those problems addressed before they go through another freeze and thaw this winter. (The city) is more concerned with the outside, the roof and other big ticket items that need to be fixed."

Scott said when Rajabi was considering purchasing the property he asked what repairs would be needed to comply with last year's notice.

"I've been in talks with him about what would be required," he said. "He had a lot of advisers and other people come in and look at the building. He was trying to decide if he did buy the building what would get worked on first."

The late Morin M. "Monty" Scott Jr., the former owner of the hotel, told the equalization board in 2015 it would take $45-50 million to modernize the property.

"It involves closing the hotel for two years, scaffolding the whole thing, redoing all the windows, waterproofing all the bricks, redoing all the fretwork on top, the towers, the tile work, re-plumbing and electrifying the hotel," he said.

Local on 07/12/2017

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Arlington Hotel sold for 25 percent less than market value - Hot Springs Sentinel