SAVANNAH, GA—In a town that drips old-world ambiance like so much Spanish moss from a live oak, hotel owners and developers are finding Savannah an interesting fit for their portfolios.
“Robust is a very good word for it,” said Joseph Marinelli, president of Visit Savannah, the historic city’s convention and visitors bureau, describing industry interest. “Marketwide, we’re running about 72% occupancy and our historic district, which is really the Savannah experience, is running about 82%. As it relates to growth, we’re on the cusp of an explosion of new properties happening.”
There’s keen interest by hoteliers in being part of the historic district, with its proximity to the city’s riverfront, boutique shops, restaurants and entertainment venues a coveted bonus.
Atlanta-based North Point Hospitality Group recently developed and opened a Homewood Suites by Hilton at 611 East River St., within walking distance of the riverfront. Hilton recently recognized North Point, which owns the 160-suite, extended-stay property, as its developer of the year for the project.
“Savannah attracted more than 13 million visitors [in 2014]and, with the fastest growing port in the nation [according to the Savannah Morning News’ website], the city is poised for growth,” noted Bill Duncan, global head, Homewood Suites by Hilton.
“Our current visitor numbers are the 2014 stats, with 13.5 million visitors to Savannah annually,” said Megan P. White, marketing projects manager for Visit Savannah. “For 2016, we are hopeful, based on the amount of business already on the books and a continued strong economy, that the number of visitors annually will continue to rise.”
Other hotels slated to come online this year include Hotel Indigo this spring and a Fairfield Inn & Suites in the fall.
The 252-room Hotel Indigo at 201 West Bay St. formerly operated as the Inn at Ellis Square, which was purchased by Atlanta-based Noble Investment Group in 2014. The property is an adaptive-reuse of a 19th-century, dry goods storage house and shop that subsequently became a grocery store that operated in the 1940s and ’50s.
The Fairfield Inn & Suites at 115 Alton St. is being developed by owner HOS Management, LLC, and will feature 138 guestrooms (including 47 suites), a 3,000-sq.-ft. meeting room (plus boardroom), outdoor pool, free WiFi, a fitness center, business center and lobby bar. A 302-space parking garage adjacent the property also is planned and will include Tesla and electric-car charging stations.
HOS Management, which did an adaptive-reuse of a nearly 200-year-old cotton warehouse and opened Savannah’s The Cotton Sail Hotel in 2014, also is planning to develop a 103-room Cambria Hotel & Suites at 321 Montgomery St. and a 135-room Aloft at 512 West Oglethorpe Ave.
Marinelli described the influx of hotels as smart growth. “It’s really the boutique style of hotels that are coming. They tend to be a little smaller, a little more targeted to the audience we’re trying to attract right now. It’s not big, convention hotels coming in,” he said.
The executive noted that wave washed over Savannah about 10 years ago, with big-box hotels claiming spaces. That was followed by another wave of limited-service properties.
“But, what’s about to hit right now is this new line of boutique/lifestyle hotels: Curio, Tribute, Aloft, etc., that are all coming in; about 2,400 new rooms into the marketplace with about 60% of that in our historic district,” said Marinelli, noting the building inventory lends itself to the segment. “We have a hotel in town that started as a horse stable, became an automotive manufacturing plant, from that a Coca-Cola bottling plant, and from that became The Mulberry Inn, which was a classic, historic hotel. Kimpton came in, and it’s now called The Brice and it is one of the hottest, new hipster properties in town,” he said.
As might be expected, there are a wealth of guidelines and regulations for those seeking to develop in the historic district, although that was not always the case, with some glaring examples of out-of-place hotel architecture extant in key locations.
“Today it’s a very different game,” said Marinelli. “Historic preservation is so critically important to what the product is; we don’t want to become Everytown, USA. So, there are very, very strict Historic Review Board regulations. For example, the maximum height you can have in the historic district is five stories.”
The executive cited developer Prince-Bush Hotels as an example of doing it right. “It built a Hampton Inn and Holiday Inn Express on Bay St., which is our main drag, and they are two of the most beautiful hotels in our city,” he said.
A big-time preservation project is coming via Savannah native son and iconic hotel entrepreneur Richard C. Kessler, president, CEO and COO of The Kessler Enterprise, who brought to the city the Bohemian Hotel Savannah Riverfront, the Mansion on Forsyth Park, and once owned the historic Kehoe House B&B. Kessler is planning to convert the historic Georgia Power Plant on River St. into the largest Kessler property to date and flag it as a JW Marriott.
Kessler is revamping roughly 4.5 acres that encompass the power plant into a mixed-use development consisting of commercial, leased space for retail, food and beverage operations, a 500-car parking deck and the 419-room luxury hotel set across several different buildings that will either be restored to meet historic guidelines or designed to meet the district’s regulations. Among other components planned are a 3,500-sq.-ft. and a 7,000-sq.-ft. ballroom; an approximately 4,000-sq.-ft. entertainment center that also could be used for group meetings; an accompanying park; three rooftop bars; an art gallery; a Poseidon Spa; wine-blending and wine-tasting venues; and kiosks for boutique and local retailers Kessler plans on being under construction with the estimated two-year development at the end of March or early April.
Marinelli has confidence in the market and absorbing the new inventory. “Having the big brands in town—Marriott, Hyatt, Hilton—we’re listening closely to what their corporate offices are saying. But, we’re also looking at our group-booking pace, and we’re 30% ahead of where we were four or five years ago. Assuming that the economy continues to stay strong and that next terrorist activity doesn’t happen and all the things that all of us in our industry worry about every single night, we’re projecting a very, very optimistic next couple of years,” he said.