When Naito Development scooped up the seedy circa 1907 Grove Hotel in 2014, Bob Naito's Portland peers thought his $22 million investment in seedy Old Town/Chinatown was a bit of a gamble. Three years later, the Portland real estate tycoon—the developer behind nearby Lan Su Gardens and the Pearl's Ecotrust building—could be forgiven for feeling vindicated.
“The fact that you have this neighborhood between downtown, south of Burnside, and the Pearl District," Naito explains. "It’s—I don’t want to say the last—but certainly the next place that's going to see a lot of investment and revitalization. Just because of what’s going on around it.”
Naito's vision was to build up the original property—a sad, stucco-walled three-story property occupying the block immediately west of downtown’s iconic Chinatown gateway—into a 113-room boutique hotel courtesy of an additional new nine-story tower. Naito's firm had the blessing of the Grove's prior owner, the Portland Development Commission (now Prosper Portland); Prosper Portland's website still lauds the deal as "a milestone in Old Town/Chinatown’s continuing momentum.”
To fund the ambitious project, Naito's firm brought in partners from beyond the Portland area: New York-based Eagle Point Hotels and Filament Hospitality. By late November 2017, the upscale hotel looked ready to open. Then it didn’t. As reported by the Portland Business Journal on November 21, the brand-new hotel had quietly changed hands just weeks prior—to Ennismore International, a rapidly expanding European hospitality brand owned by a splashy young Indian-born scion.
Naito's surprise November sale (the amount hasn’t been publicly disclosed) means that the Grove is now part of Ennismore's Hoxton Hotels portfolio, known for a flagship property in East London's newly hip Shoreditch neighborhood and, more recently, a locale in Paris's Second Arrondissement.
By November 30, Hoxton, which describes its hotels as “inspiring cultural discovery in key neighborhoods,” had posted a picture of its new purchase on Instagram, with the tease “exciting times ahead.” (A timeline on Hoxton's website mentions at least three other forthcoming hotel openings in the United States, in Williamsburg, Los Angeles, and Chicago.)
Naito admits he was spun by the sale’s swiftness. He says he was first approached by the hotel chain in August, even as local media geared up for the Grove's speculative 2017 opening.
“To identify in August and close in November is running at light speed in the real estate business,” he told Portland Monthly.
Apparently Hoxton's scouts felt Old Town's rough edges wouldn't deter well-heeled adventurers. (Rooms at the Hoxton Shoreditch go for about 180 pounds a night.) Some locals have doubts about that. In an August 2016 preview of the changes set to come to the neighborhood, the Portland Tribune called out the tourism challenges faced by the also-new Society Hotel, just blocks away from the Grove on NW Third and Davis: namely, the district's high crime rates and proximity to social services.
Yet clearly, Naito—who is already looking for his next Old Town investment—isn't alone in seeing the churning district as smart money for developers.
The Portland Hoxton is slated to open in summer 2018.