In its first investment in the South, the New York-based DelMonte Hotel Group has purchased the Moxy hotel in downtown Chattanooga for nearly $14.5 million.
The 108-room Moxy was built by the Chattanooga-based 3H Hotel Group in 2018 at the corner of King and Market streets and caters to both business and leisure travelers.
The four-story boutique hotel is built atop the Bar Moxy, where guests check into the hotel. The pet-friendly hotel includes an outdoor patio with fireplaces and sofas, a fitness center, a customizable meeting space and rooms with modular design and custom furniture.
"We're thrilled to add Moxy Chattanooga Downtown to our growing portfolio of properties and make our mark in one of America's most breathtaking cities," Alexander DelMonte, chief executive of the DelMonte Hotel Group, said in an announcement of the purchase. "Moxy is buzzing with high energy and an energetic crew that always aims to surprise travelers. It is also situated in an ideal location, surrounded by outdoor adventure and iconic world-class attractions that are within walking distance for our guests to enjoy day or night while exploring all that Chattanooga has to offer."
The Moxy hotel has helped spur the redevelopment of King Street, which previously housed a number of warehouses next to the ADM flour mill. In 2019, the 3H Group also converted a former cold storage warehouse, the $35 million King Street Station next to the Moxy Hotel offering office and commercial space atop a Goodfellas Pizzeria.
"In transforming the site of the Moxy, we breathed new life into a once dilapidated corner at Market and King, making it an entertainment destination," Hiren Desai, president and CEO of the 3H Hotel Group, said in a statement Thursday. "As we shift focus to new projects, we are proud of the Moxy's No. 1 rating in guest satisfaction and know it is in great hands."
DelMonte said the new owners plan to work with the onsite employees on some light improvements. DelMonte said his company is "lucky to have inherited this award-winning team and do not intend on making any changes."
DelMonte said the hotel is the first in the South for the Rochester, New York-based hotel development and management firm that owns other hotels in New York, Pennsylvania and Ohio. But he said his firm is continuing to look for other possible acquisitions.
"We have been eyeing opportunities in Tennessee for a while, and when the opportunity came to plant our flag in Chattanooga, we were excited to do so," DelMonte said. "We were impressed with the demographics and healthy mix of demand generators in the market."
The purchase of the Moxy comes as other local hotels are boosting their rates and occupancy coming out of the pandemic shutdown three years ago that produced the worst downturn ever in the lodging industry.
Mitch Patel, president of Chattanooga's biggest hotel company, Vision Hospitality, told the Chattanooga Rotary Club on Thursday that the Chattanooga market fared as one of the best of any city during the pandemic downturn.
"We were the least bad," he quipped. "Going forth, we're optimistic about our hometown as a value-oriented, drive-to market with all of the experiences we can offer people in Chattanooga."
The Chattanooga Tourism Co. released figures Wednesday showing that overall lodging revenue last year in Hamilton County was up 25.8% from the pre-pandemic peak reached in 2019, with a 5.4% increase in rooms sold in 2022 to a record high.