Noble Tries Its Hand At Boutique Hotel

ATLANTA— Mit Shah is looking for more than just a financial return on investment on the $31 million his company has invested in converting the Holiday Inn Buckhead into a Crowne Plaza. Hes joined the ranks of hoteliers looking to run a property that combines “substance with style.” Noble, of which Shah serves as COO, bought the property in July 2000 for $15 million, raised the Crowne Plaza flag over it, and poured $16 million into it to create what it believes is a competitor to Ian Shragers boutique hotels and Starwoods Barry Sternlichts Ws. Nobel’s latest move to carve out its niche in the hip world of boutiques, is to recruit Jon Afredi from the W Atlanta as the property’s general manager. Prior to serving as GM at Atlanta’s W, Afredi was the GM for the W San Francisco. Another strategy was to install in its rooms a luxury bedding package, with custom-manufactured, pillow-top mattresses, 300-thread-count sheets and down comforters, which Noble developed after tearing apart Starwoods Westin Heavenly Bed to see how it was made. Each guestroom also received a significant technology investment, with high-speed wireless and hard-wired Internet access provided by StayOnline; Sony CD players; and Sony PlayStations. A 5,000 square-foot grand ballroom has 300 high-speed wireless connections, while a signature restaurant called Milan, complete with a trendy bar scene which caters to the local market was added. “Atlanta for years has wanted to be very trendy like South Beach, Los Angeles or New York,” said Shah, “and there hasnt been a hotel in Atlanta that has been able to combine five-star service with the style of a hotel that really fits that image.” “So we saw that there was a niche, and [a chance to]not just be a big-box hotel,” he said. “When you create a story with something, there is something that attaches the customer emotionally to that, if you are able to follow style with substance, which weve tried to create here.” That the hotel is located practically at Nobles corporate front door puts more pressure on the company to deliver five-star service, said Shah. “It is really where everybody who we tell the Noble story to will stay, and really see whether we are telling a story or if its actuality.” Butler service is in the process of being added, he noted. Who is the Crowne Plaza Atlanta-Buckheads competition? Shah said in his market, the “big four” are Ritz-Carlton, the JW Marriott, the Grand Hyatt and Swissotel, all of which are owned by Host Marriott. Those properties, as well as the Ritz-Carlton, Four Seasons and W in downtown Atlanta, are “who we will go after from a competitive set and also an ADR and occupancy standpoint once we are stylized,” said Shah. In a typical year, the Crowne Plaza Atlanta-Buckhead would have seen an average RevPAR of $100, an average occupancy of 68% and an ADR of $144. After Sept. 11, Shah predicts the statistics “will be a little bit off that” for 2002. Hearing Shah describe the atmosphere of the hotel (guests enter a candlelit lobby, check in at a “pod” rather than a front desk, go upstairs and come back down dressed in black to adapt to the trendy feel), the question begs to be asked, “Why choose the Crowne Plaza flag?,” which historically has had a more traditional environment. “The dynamics for us to make it a Crowne Plaza were interesting because obviously, this isnt your fathers Crowne Plaza,” said Shah. The flagging came about, he said, because Noble has a good relationship with the brands parent company, Six Continents, as well as with Marriott and Hilton. That Six Continents also has a headquarters office in Atlanta further helped synergize the deal for Noble, said Shah, whose own headquarters are right near the Crowne Plaza. Noble wanted to go with a brand, even though it was looking at the boutique niche, because “looking at how the capital markets were working at the time of the asset purchase, doing an independent wasnt right for us,” said Shah. “We