Major hotel companies ready to make a play for convention center spot

Monday, May 19, 2008 at 2:20am

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.

Filed under: City Business
By: JeffF on 12/31/69 at 6:00

The Peabody is living a lie. The chains win not because of sales but because of frequent guest programs. If all they want are convention travelers they can do okay. But they will need way more than that.A recent trip to Orlando for a convention gave me a choice of hotels. I tried getting into a Marriott or Hilton property in order to earn points but found them all to be full. The Peabody close to the center (not attached by the way) had plenty of rooms. Nashville would do everyone a favor by letting Peabody build a boutique on the riverfront site (which they proposed years ago) and letting a big boy build their own hotel close to the white elephant.

By: producer2 on 12/31/69 at 6:00

Wow JeffF you want to help the "White Elephant" now? I would guess you would want to do everything in your power to see it fail. By the way how was the Orlando Center doing while you were there. Are thy one of your failing "white elephants" now that they have added an additional 1 million swuare feet of space? You know the industry is doing so poorly.....

By: JeffF on 12/31/69 at 6:00

Producer, you did notice that Orlando's convention center is miles and miles away from their downtown, sort of like, let's see, Gaylord Opryland distance from our own downtown. Also, please not that they are one of the three exceptions I listed to you several weeks ago. Nashville is not Orlando, Las Vegas, and San Diego yet we want to join the 2 dozen other cities willing to lose money in order to compete with them? By the way I was waiting for you to mention Orlando, I have been holding on to its top secret geographic location. Maybe Downtown Nashville's tourism pigs would be willing to forgo having the white elephant near them for the good of the entire city?

By: JeffF on 12/31/69 at 6:00

Wait is just occurred to me that Las Vegas' convention facility and all the big private facilities are not in downtown either. I see a pattern developing. 2 of the 3 successful large centers in the U.S. are not located in downtown areas. Meanwhile all the new failing ones are located in downtown areas except San Diego. Am I the only one who has noticed this?

By: Time for Truth on 12/31/69 at 6:00

Orlando also has a giant theme park or two to make it a destination city. I wonder if Nashville should build one maybe also out by Gaylord. Wait, they USED to have one but Gaylord tore it down to build a mall! Didn't Gaylord also have their hand out for a tax break on that plan? Or was it for their last hotel expansion? Or both?Bredesen actually said no to Gaylord once and it was probably one of his better moves as mayor.Downtown Nashville needs more hotel space. Most hotels have their own small convention space. We doesn't need the white elephant. That sound like a giant toilet flushing that we'll hear in about ten years near 8th and Demonbruen is the sound of money being sucked out of the city treasury.

By: airvols on 12/31/69 at 6:00

Get over it it's coming!

By: idgaf on 12/31/69 at 6:00

Parking is the big negitive to downtown convention centers. (ball parks too)Besdie there is nothing to do here for families compared to the successfull cities.We are spending a lot of money to put a few bucks in the pockets of some business people/campaign contributors.

By: Time for Truth on 12/31/69 at 6:00

We "DON'T" need the white elephant. Ooops.Peabody is a nice small regional brand. I have worked at their on-site meeting facilities in both Memphis and Orlando. The memphis hotel has far more character, but both are good hotels. A Nashville hotel would be welcome and the river site would be perfect.Jeff, back when I was supporting the Sounds plan (before they kicked their own @$$) I seem to remember that Peabody wanted TIF money too and that's one of the reasons they didn't end up here. Of the four proposals made, only the hideous dry stack marina plan wasn't asking for TIF. Correct me if I'm wrong.

By: Time for Truth on 12/31/69 at 6:00

Hasn't Dean just finished telling us that the city is broke? Hiring freezes, cutbacks, etc. Did he end his speech with "pay no attention to the giant white elephant behind the curtain." ?

By: nashbeck on 12/31/69 at 6:00

I hope the Hotel is tall and beautiful, such as the Westin in Atlanta. Producer, is the hotel location going to be located behind the Country Music Hall of Fame?Idgaf, fortunately Tony Giarratana has plans of constructing a parking garage in SOBRO with one of his next projects, so hopefully that will help ppl that will have trouble parking (Although we are in a bigger need of a streetcar system!)

By: Anna3 on 12/31/69 at 6:00

Folks...The deals already been cut. Purcell and Dean met with Marriott last year and worked a deal out so that Marriott's Renaissance Hotel would buy the old Convention Center if they were able to put the anchor hotel (1000 Room Marriott) in the new Convention Center. Purcell and Bill Marriott personally shook hands on the lets see how it plays out. and by the way...Marriott just sold the airport Marriott to a real estate trust too! Go figure. Moral of the story:The "Fix" is ALWAYS in when dealing with Metro!

By: RTungsten on 12/31/69 at 6:00

I think people are wanting AFFORDABLE parking downtown. You can bet that Tony G's parking lot will not be cheap. As long as the high parking prices remain downtown, the businesses will continue to lose customers to outside areas. Personally, I love going downtown for dinner or lunch, but having to pay $7 - $10 to park, in addition to food is a bit much.

By: producer2 on 12/31/69 at 6:00

jeffF this shows how blatantly ignorant of the facts you are. Orlando's center is built close to the attractions and hotels that visitors want to see. Same thing for Nashville. When will you learn that I have forgotten more about this industry than you will ever know. airvols is right, get over it, it's coming...

By: Time for Truth on 12/31/69 at 6:00

Anna, I'm betting that's not the only deal that's already been cut. Wait and see who gets the contract to build the big turkey.

By: Time for Truth on 12/31/69 at 6:00

producer, correct me if I'm wrong, but aren't you just selling meeting space, not building, planning or financing it?

By: producer2 on 12/31/69 at 6:00

I would not call it "the fix" since part of that deal calls for Marriott to buy a portion of the old center from the city.I would call that good business, but those of you on this board that seem to know how to do it better may disagree (imagine that). earlier in the day JeffF said the city should go with a national brand so what is the problem with Marriott? Get your stories straight, the spinning is making everyone dizzy!

By: JeffF on 12/31/69 at 6:00

I did not realize that the convention center was being built near Maryland Farms, Cool Springs, and Jack Daniels. I was working under the silly assumption that it was being built in downtown where there are no real tourism draws except during the CMT festival. My bad. You know where else there is a tourism draw, Opryland/Music Valley. Someone should put a convention center out there.Actually I worked in the "industry" for quiet a while in East Tennessee. That is indeed the reason why I know things that the "industry" would prefer the general public and the elected official not know. Seriously, go get an economics degree and learn how harmful your "industry" really is. Tourism is the industry that shackles the rest of the economy.

By: producer2 on 12/31/69 at 6:00

What a stupid statement JeffF, have you forgotten that Nashville is Music City USA? Is the New Orleans Convention Center close to The French Quarter? Attendees don't really care about Maryland Farms, what kind of crack are you smoking son? Again I challenge you to identify your idea of the industry, is it "Dollywood" or do you actually have some experience with meetings and conventions?

By: JeffF on 12/31/69 at 6:00

as for hotels. I would think a business hotel would be a wiser investment for downtown than a convention or another tourist trap establishment. Right now downtown needs business not tourism. Unfortunately downtown interests have been hijacked by tourism interests. A vibrant downtown does not need tourists, it needs class A office space and tenants to occupy it. our esteemed elected officials though are not doing anything for the benefit of real business, the overload of capital spending in aimed at the pretend business of tourism. People have to realize soon that tourism and the people who love it are evil and produce nothing of value. They encourage things to bring in visitors but decry useful things like office buildings. The building approved recently for Bass, Berry, etc is an example of this. The dealers of worthlesss tourism decried it while encouraging this "me-too" tourism trap.

By: JeffF on 12/31/69 at 6:00

I have worked for hotels in Knoxville and Gatlinburg and with centers in two other cities in Tennessee

By: JeffF on 12/31/69 at 6:00

Did you know the New Orleans Convention Center was a failure before the hurricane even hit or were you depending on the ignorance of non-tourist types to keep that a secret.

By: producer2 on 12/31/69 at 6:00

Your kidding right? The New Orleans Center was a failure? Your answers coupled with your previous work experience (and namely the areas of the state) show you have no real lnowledge of the convention industry as it pertains to Nashville. I have worked in the center in Gatlinburg, it is quaint but not something that NAMM is going to use for a conference. Same goes for Knoxville. I don't see Society of Hand Surgeons or HP clamoring to get to Knoxville. Before you even go there all of those groups are or have been booked in Nashville so don;t bother...

By: NewYorker1 on 12/31/69 at 6:00

The bright side is, I'm still beautiful.

By: JeffF on 12/31/69 at 6:00

Definition (real world): Failure- When income fails to meet expenses.Definition (pretend world): Success- When you can get cool sounding convention that brings a lot of people for 3-4 days even if it costs more than the money it brings in. Example: All conventions in New Orleans since the center heavily discounts in order to get people in the door. What would be great is if convention centers could pay for themselves and get the cool, big conventions. Unfortunately for Nashville and the 20+ other cities building or already in new centers, those situations only exist in three cities (San Diego, Las Vegas, and Orlando) and the privately owned centers operating with a profit motive.

By: gdiafante on 12/31/69 at 6:00

In reality, why would anyone want to come to Nashville? Seriously. I've often asked my in-laws that are from Iowa. Other than "we've never been here before" or "country music" they have no reason.

By: Time for Truth on 12/31/69 at 6:00

NAMM, after wandering off for a couple of years, has wandered back to Nashville perfectly content to hold their convention in the current center. Because we are Music City and the buyers of their product live here, NOT because we are "Music City" and have a Hillbilly Hall of Fame. Or because we have a bazillion dollar center.NAMM is the example white elephant boosters used to point to when decrying the 'need' for the new center. Guess what? NAMM doesn't need it. JeffF, I don't like the BBS tower, as you may remember, because it will look like a giant phallus in the middle of Sobro. But I can certainly live with it since it won't be picking my pocket. We are on the same page on this turkey, though.

By: Time for Truth on 12/31/69 at 6:00

gdiafante, maybe if we had a theme park out near Gaylord Opryland...oh, yeah, that's right, it's gone. Replaced by 'shoppertainment' (that's Opry Mills' term, I couldn't make up something like that).

By: gdiafante on 12/31/69 at 6:00

Maybe, but I doubt it. It would have to be much better than Opryland ever was.

By: cowboy59 on 12/31/69 at 6:00

Time to check your facts - NAMM said all along it would come back to Nashville in its new rotation, but not permanently until a new facility is built. It's here for 2008 and then back to Indianapolis for 2009 to start the rotation again.

By: producer2 on 12/31/69 at 6:00

TFT Wrong on all counts as usual. NAMM only agreed to come back if they were given assurances that a new facility was coming. Second they came back becasue Nashvilee is the strongest draw they have as a city to hold their conference. You guys make up more crap than any three prople I have ever seen. It has become comical to me (and I am sure those who see this) to watch what you will come up with next. I can't wait for the replies...

By: Time for Truth on 12/31/69 at 6:00

prod, you just said what I said. "they came back because Nashville is the strongest draw they have as a city to hold their conference". The hall is full of musicians when they are here. Whether or not they want the white elephant, they don't need it.

By: Time for Truth on 12/31/69 at 6:00

prod, I see your "TFT is a racist" snit is over with. Did you finally take your blindfold off in a hotel kitchen and see a roomful of people from south of the border? This is not to say they shouldn't have those jobs, assuming they are here legally. I am only reinforcing the point Jeff made that these generally low wage jobs are what we'll see when "all those new jobs" arrive.

By: producer2 on 12/31/69 at 6:00

TFT, you are not woth the energy. There are people of all nationalities in kitchens, what is your problem? There are all kinds of white collar and blue collar jobs in the meetings and conventions industry. You guys have no clue. You and JeffF seem to equate everything to Pidgeon Forge. Get a life...Also NAMM left because of the lack of space, they are coming back because they have been promised more space in the future.