Army privatizing temporary lodging at 10 posts

Eds: UPDATES with details of developments, comments from Army officials; ADDS byline, Internet note.

By JOHN MILBURN

Associated Press Writer

TOPEKA, Kan. (AP) -- The U.S. Army is privatizing temporary lodging facilities at 10 installations across the country this summer in a move it said will improve the quality of life for soldiers and their families.

The first properties will be transferred on Aug. 15 to Actus Lend Lease to be redeveloped and will be operated by the InterContinental Hotels Group LLC, the Army said late Monday.

The privatization is similar to efforts launched in recent years to privatize housing for soldiers and families at Army installations. The next phase is for those facilities used by soldiers or guests who are staying at an installation for a short time for training, meetings or who are processing to regular military housing.

Five sites will be renovated and converted into Holiday Inn Express hotels within the first two years. New hotel construction is also planned.

Rhonda Hayes, director of capital ventures for the deputy assistant secretary of the Army for installations and housing, said Actus and InterContinental will receive fees for service that are below market rate, but higher than the current rate paid for stays in the military lodging. The companies had been selected in September 2006.

"By privatizing the facilities and seeking private-sector expertise and financing, the Army can renovate and build new hotels," Hayes said.

The transfer of operations will take place at Fort Rucker, Ala.; Fort Leavenworth, Kan.; Fort Riley, Kan.; Fort Polk, La.; Fort Sill, Okla.; Fort Hood, Texas; Fort Sam Houston, Texas; Yuma Proving Ground, Ariz.; Fort Myer, Va., and Fort Shafter-Tripler Army Medical Center, Hawaii.

At Fort Riley, the Army will transfer 63 rooms in five buildings to Actus. A new 139-room Candlewood Suites hotel will be built on Custer Hill near soldier-family housing that is already there.

Mick McCallister, interim director of housing, said two of the Fort Riley buildings were built in the 1800s. All the buildings being privatized will be brought up to code and into compliance with the Americans with Disabilities Act.

"It's a use of private-sector financing to revitalize and build these lodging facilities at these installations," McCallister said. "There is no government contribution other than lease of property."

Civilian employees at the Army facilities will have the opportunity to transfer to work for InterContinental. The Army said seven of the 10 lodging general managers have accepted positions with the hotel company.

There are 15,000 soldiers assigned to Fort Riley and that figure is expected to grow to more than 18,000 by 2013. McCallister said because of that, Fort Riley needs to increase its number of temporary lodging rooms to 148. The Army expects daily occupancy of at least 75 percent.

The Army is modeling the lodging privatization after its residential communities initiative, aimed at eliminating inadequate housing for soldiers and families. Fort Riley privatized in July 2006 and McCallister said the post's partner was about 20 percent complete in constructing new homes. The building, which is part of a 50-year lease between the Army and Picerne Military Housing LLC, will be complete in 2016.

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