We’re introducing our Best Real Estate Projects for 2021-2022. This is the top hotel project.
True to his agrarian roots, Sunny Dale, owner-developer of the new Exchange Sacramento hotel, believes that, like an unexpected storm or dry spell, the project’s hardships have merely made him stronger.
“I’m really good at finding the most difficult projects to start with,” said Dale, owner of Yuba City-based Dale Investments LLC. “My subcontractors reminded me that I was nuts for picking a 1914 building as my first hotel project, but, from what I’ve learned, I think the next one should be a walk in the park.”
Having acquired the old California Fruit Building in 2013, Dale, whose family started out in farming in the mid-’70s before moving into real-estate entitlements in the 2000s, envisioned keeping the building as an office property but upgrading it to highlight the building’s architectural heritage.
Upon the 2016 opening of Golden 1 Center nearby, however, Dale rethought his redevelopment plans and opted to repurpose the 10-story building, which had been the city’s first high-rise, as a 100-room hotel in order to fill what Dale said was a lack of higher-end hotel rooms in the area.
Starting construction in the summer of 2018 with an 18-month build-out schedule, Dale took over the builder role after the original general contractor didn’t work out, then was beset further in 2020 when Covid-related restrictions imposed both on-site scheduling limits and supply-chain kinks.
Then, as the project neared completion early last year, a ruptured water main under Downtown’s Fourth Street flooded the hotel’s basement — “the brain of the hotel,” according to Dale — with as much as 18 inches of water.
Ultimately, Dale’s passion for the building’s history and architecture won out, and the hotel opened as part of Hilton’s Curio Collection brand last September. Having visited Curio properties in San Diego, Philadelphia and London, Dale — who estimated spending about $35 million on the project — said he was swayed by the brand’s number of hotels that’d been converted from historic properties.
“I was in awe the first time I saw the front of the building,” said Dale, who added that he was especially smitten by the property’s terra-cotta work. “Its condition blew my mind.”
Still in store for the hotel is Willow, a 115-seat Mediterranean-themed restaurant slated to open on the property’s ground floor in September. The hotel also has a third-floor space that Dale expects to convert to either a restaurant or bar sometime within the next two years.
Regardless, nearly a year since the opening of the hotel, which is operated by Elk Grove-based American Hospitality Services Inc., both Dale and the hotel’s design consultant Whitney Johnson say the Exchange Sacramento is representative of a city where people appreciate the finer things with an informal touch.
“We like really nice things, we grow nice things and we serve nice things, but we’re going to do it in a ballcap,” said Johnson. “We managed to build a really beautiful piece of history in the city. To have it full of people and have it look good, I’m very proud of that.”
FAST FACTS
Details: Boutique hotel of 100 rooms in the old California Fruit Building, erected in 1914 and previously used as an office building
Cost: $35 million
Completed: First guests were welcomed in September 2021
Developer: Dale Investments LLC
Contractor: Copeland Ventures
Architect: Arris Studio
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