published Sunday, January 3rd, 2010

More downtown hotels planned

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    Staff Photo by Dan Henry Construction soon will begin on a new Hampton Inn & Suites at the corner of Fourth and Chestnut streets in downtown Chattanooga.
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Kim White

Downtown Chattanooga has come to host an array of new hotels in the past decade, and a stunning $79 million in new lodging is on the drawing board.

The riverfront and the central business district are in line for a total of at least four new hotels — if they are all built.

The economic downturn has delayed construction of some projects that were announced earlier.

Kim White, who heads the private, nonprofit downtown redevelopment group RiverCity Co., said she expects movement on the hotels when credit starts flowing more freely.

“We have a lot out-of-town investors who have spent a lot money and projects are all teed up ready for a break in the whole financial market,” she said.

Mrs. White said she definitely thinks more hotel rooms are needed.

“When a large convention comes into town, there isn’t enough space,” she said.

Sue Lauffer, senior project consultant on the planned Crowne Plaza in the former Chattanooga Bank & Trust Building downtown, said the city is seen as a growth market.

“Chattanooga has that perfect blend of corporate, retail, residential, and there’s a phenomenal amount of things to do downtown,” she said.

CLP Development LLC of Atlanta, which has proposed the $24 million hotel and condominium revamp at Eighth and Broad streets, is finalizing the project with plans to start early this year, Ms. Lauffer said.

Developer Ben Parker, who is eyeing a hotel in a converted Maclellan Building on Broad, said views from atop the proposed 12-story hotel will be like nothing else the area has to offer.

He said financing delays have held up the project, which he hopes to start early this year as well. Mr. Parker predicted a pretty easy renovation with the way the building is laid out.

Vision Hospitality Group, a Chattanooga-based hotel management and development company, has proposed a Hampton Inn & Suites at Fourth and Chestnut streets.

“We’re still in the works on the financing,” said Hitel Patel, the group’s director of development and acquisitions.

He cited the transformation of downtown since the opening of the Tennessee Aquarium and the strength of the leisure market in the city.

Vision recently invested about $27 million into transforming a Clarion Hotel into the Doubletree on Chestnut, and its relatively new Holiday Inn Express opened on M.L. King Drive.

“It’s our home base,” Mr. Patel said about Chattanooga.

The North Shore also has been mentioned in recent years as a site for hotels. Vision is looking at a unit at Manufacturers Road and Cherokee Boulevard near the new BridgeView condo project.

Mrs. White said the plannted hotels offer variety in terms of services and price points and that’s good. Chattanooga’s downtown draws a wide range of visitors, she said.

“Our downtown is built for everyone,” she said. “It’s a testament to the wide variety of interests we appeal to — from the Head of the Hooch with all the young college kids to young families who come to visit the aquarium.”

On the wish lists of some is a new hotel near the Chattanooga Convention Center. Convention officials have said the city is losing meetings because of a lack of rooms near the center.

While the meetings business has risen with the expansion of the Convention Center earlier this decade, a new hotel near the facility would help take business to another level, officials have said.

Downtown Chattanooga has about 2,000 hotel rooms, according to tourism officials.

Mrs. White said Volkswagen and suppliers will drive more lodging traffic.

“We will have I think more out-of-town people who are coming because of that,” she said.

In addition, locally based 3H Group is planning a Spring Hill Suites as part of the Cameron Harbor mixed use project off Riverfront Parkway on part of the former Jones-Blair property.

Additionally, Chattanooga developer Allen Casey has talked about a hotel on Manufacturers Road as part of a larger development on property across the Tennessee River from Ross’s Landing.

about Mike Pare...

Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...

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sideviews said...

Jason Reynolds wrote a nearly identical story about how these same projects were about to get started in the Times Free Press in July 2008. Earlier, there were other hotel plans announced by Bill Young for The Coolidge Hotel on two different sites in North Chattanooga; B. Allen Casey proposed both a "boatel" and an Amerisuites hotel on the North Shore, and Warehouse Row proposed converting part of its Market Street complex into a hotel. If all of these projects stalled when employment was greater, credit was easier and online networking was less popular for conferences than today, why will these projects succeed now? I don't understand why Kim White thinks that Volkswagen's assembly plant in Ooltewah where 2,000 mostly blue-collar workers will be employed will drive a market for luxury downtown hotels. VW managers who now work in one of the Chestnut Street towers will soon be moving out of downtown to Enterprise South near where other motels have or will be built. Some of these proposed downtown hotels, as designed, would cost more than $160,000 a room to construct and won't have any on-site parking. I hope there are some new downtown hotels built in Chattanooga. But it's really hard to imagine we'll have $79 million of more new hotels built in downtown in my lifetime.

January 4, 2010 at 10:21 p.m.
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