VOL. 131 | NO. 163 | Tuesday, August 16, 2016
Hotel Napoleon Joins Growing List of Unique Downtown Lodging
By Madeline Faber
A Downtown property’s ample windows, turn-of-the century architecture and an interesting backstory attracted hotel developer Suna Investments to the historic Winchester Building at 179 Madison Ave.
After a complete overhaul of the former office building’s architectural and engineering components, the property will open as the 58-room Hotel Napoleon later this month.
Snay Patel, principal of Suna Investments, said that he wanted to branch out from the Holiday Inn and Comfort Suites hotels he’s developed in the Southaven market. With the move Downtown, he joins several other hotel developers looking to capitalize on Downtown’s unique character and stock of historic buildings.
“If you take an existing building, it’s harder to convert it to a hotel than to do ground-up construction,” Patel said. “But the trend everything is going is millennial-based. They want something with a storyline, something historic that people can grab onto and learn about. People will travel to learn the history of places.”
Patel said he sees Hotel Napoleon joining the ranks of The Peabody and The Westin Memphis Beale Street as a high-end, high-rate hotel. The building will feature a farm-to-table eatery called Luna Restaurant and Bar, two ground-floor suites, LED lights throughout the building and a fitness facility.
Hotel Napoleon converts a five-story office building built in 1902 by Memphis merchant Napoleon Hill. Hill’s initials can be seen etched into the façade of the building, which Patel said provided inspiration for naming the hotel. In the building’s heyday, Hill lived across the street in the Sterick Building, one of Memphis’ most iconic skyscrapers.
The 44,000-square-foot building was originally occupied by newspaper the Memphis Press-Scimitar and then later Memphis, Light, Gas and Water Division and most recently, Crye-Leike Real Estate Services.
The Winchester Building was added to the National Register of Historic Places in 1983, and Suna Investments is taking special effort in its renovation to maintain that status and gain the use of federal historic preservation tax credits.
The building’s original Tennessee marble remains in the grand lobby, but it’s complemented with contemporary glass walls and funky lighting installations. The original circular, arched windows had to be left in tact and added windows had to follow the same design.
“Curved glass? They don’t make that anymore,” said Patel, who declined to specify how much the developers invested in Hotel Napoleon.
To build a big-box flag hotel would be more simple and less costly. Those types of hotels flourish Downtown, and a Holiday Inn Express and a Hilton Garden Inn are both currently under construction across from AutoZone Park.
However, boutique hotels are picking up greater market share.
Across from Hotel Napoleon is the former Leader Federal Bank building at 158 Madison Ave. The building’s new owner plans a 70-room boutique hotel for the mid-century building. A stone’s throw away is The Madison, an independently owned and operated boutique hotel that recently sold to a Chicago-based group for $16 million.
Also announced for Downtown are the conversions of the historic Dermon Building at 46 N. Third St. and the old central police station at 128 Adams Ave. into boutique hotels.
After Patel gets Hotel Napoleon up and running, he plans to turn his recent acquisition at 107 S. Main St. into a hotel as well.
Patel said that he and partner Jay Kumar are thinking five to 10 years ahead in building for the millennial market. Boutique hotels need to stand alone and leave a unique mark that the stucco walls of a newly built franchised hotel can’t reach. Technically, Hotel Napoleon is a member of Ascend Hotels, the boutique brand of parent company Choice Hotels. Choice Hotels provides back-of-house support, but the service and design choices are solely those of Suna Investments.
Chuck Pinkowski, a hotel consultant with Pinkowski & Co., said historic buildings can be tailored to attract the growing millennial demographic.
“That younger generation is having tremendous impact on selection of the boutique hotels,” Pinkowski said. “They want hotels where they’re going to have an experience of something. Maybe the history of the building, the neighborhood or just the fact that it’s a different style of hotel.”
With 15 projects under development Downtown, Pinkowski said that the area has still not yet reached its peak in the boutique hotel market. He said Downtown’s 3,000 hotel rooms are running a 77 percent occupancy rate with a $165-a-night daily rate.
“When the market is at 77 percent, you know that there’s what we call unsatisfied demand,” he said. “Some Fridays and Saturdays you can’t get a room Downtown.”
Pinkowski said the six hotel projects set to open Downtown within the next 18 months will feed some of that pent-up demand. Further down the line, more rooms will be needed when ServiceMaster Global Holdings completes the relocation of its headquarters to the former Peabody Place building. With St. Jude Children’s Research Hospital announcing plans for $1.2 billion in new construction at its Downtown campus and the addition of 2,000 employees, the hotel market will be further fueled.
“Those two components, I think, are going to have a very positive effect on helping fill the new supply of rooms, whether it’s boutique hotel or a Hilton Garden Inn,” Pinkowski said.