Now that the process for the new Nashville Convention Center is underway, attention is beginning to turn toward the “headquarters” hotel that would be integrated with the center.
Everyone involved with the process expects that the opportunity will attract the biggest names in the hotel business.
“Any of the major hotel companies will be looking,” said Robert Swerdling, managing director of public finance investment banking for PiperJaffray in Los Angeles.
That could mean hotel flags from Marriott, Hilton, Hyatt and Starwood. And Memphis-based Peabody Hotel Group likely will make a run at it as well.
They all will be trying to win the right to build a hotel that has potentially 1,000 rooms. The hotel and the convention center could spur more hotel development at the edge.
The Metropolitan Development and Housing Agency will conduct a market analysis this summer to lay the groundwork.
“We’re looking at everything from pre-construction through turning in the key,” said Phil Ryan, MDHA’s executive director.
That study will include looking at how many rooms are need, the appropriate hotel brands, hotel developers and the financing environment. The convention center will take approximately 36 months to build.
“We want them to come on line at about the same time,” Ryan said.
Renaissance Hotel, the headquarters hotel for the current convention center, is a Marriott brand. But that doesn’t preclude Marriott from putting its flag on a second headquarters hotel.
A hotel owner different than the one who owns the Renaissance could also bring the Marriott flag. Swerdling said it isn’t uncommon for a hotel company to have more than one around a convention center.
“Marriott would be ecstatic to have more than one,” he said.
Swerdling said the hotels could handle overflow on large events with single management. Hotels managers are paid for generating revenues not profits, he added.
Marty Belz, Peabody Hotel’s chairman, said months ago that the company would be in the mix trying to win the headquarters hotel. The company has been trying to get a hotel in Nashville for years.
Swerdling said the Peabody may have difficulty competing with Marriott, Hyatt, Hilton and Starwood. Those four dominate the group-meeting business with meeting planners, he said.
Group meetings are key for a hotel when the convention business may be slow.
“We have most of the things that a big brand has,” Belz said.
He said the hotels are tied into a network of hotels and Peabody has sales offices in Chicago, Washington, D.C., Atlanta, New York — cities where the associations and meeting planners have their headquarters.
Peabody’s 900-room hotel outside Orlando is connected to the Orange County (Fla.) Convention Center.
“We’re able to compete with the big brands with our sales force,” Belz said.