Virginia firm to buy Ronkonkoma hotel, restaurants, development site for $37 million

A Virginia company plans to buy a Ronkonkoma hotel, a second hotel site under development and two adjacent restaurants for $37 million, according to the Brookhaven Industrial Development Agency.

Excel Group, an Arlington, Virginia, real estate investment firm, is in contract to buy the 14-year-old, 154-room Courtyard by Marriott, the adjacent Smokey Bones and Red Lobster restaurants, and the site of a planned 122-room, four-story extended-stay Hilton Homewood Suites from Ronkonkoma developer Sayville Browning Properties, according to IDA applications submitted by Excel last month.

Wednesday, the IDA agreed to transfer to Excel the tax benefits previously granted to Sayville Browning.

Lee Browning, chief executive of Sayville Browning, did not confirm the buyer's identity or the financials of the deal, but said Tuesday that the acquisition was not contingent on the transfer of benefits. Excel Group managing partner Shoham Amin declined to comment on the acquisition until the deal closes.

Excel will continue the construction of the hotel and will renovate the existing Courtyard, according to the applications.

Last year, Sayville Browning was approved for tax benefits by the Brookhaven IDA, including a 10-year payment-in-lieu-of-taxes agreement, a sales tax exemption of roughly $600,000 on the purchase of building materials and furniture to outfit the hotel, and a mortgage recording tax savings of about $150,000. Previous benefits granted for the development of the Courtyard will also carry over to the new owner, though less than five years remain on that PILOT agreement.

Since the Hilton Homewood has yet to be built, those same benefits will transfer over to Excel, Lisa Mulligan, chief executive of the IDA, said Wednesday.

For nearly eight years Browning had been trying to build a 102,225-square-foot Homewood Suites, working his way through some development hurdles. Last October Browning began laying the foundation for the hotel.

After spending so many years on the project, Browning said he made the decision to sell with his wife and son, his two other partners at Sayville Browning.

"It was just a business decision," Browning said. "I think the new owners will do very well."

Browning is currently working on developing two more hotels on the Island, including a 140-room Marriott Residence Inn in Riverhead and a proposed 156-room Courtyard by Marriott on the site of a 1-acre commuter parking lot in Lynbrook. Browning also owns the Hilton Garden Inn in Riverhead.

"All of this will help the overall development of the area, including the Ronkonkoma hub," IDA chairman Fred C. Braun III said. "They're coming at the right time."