MEMPHIS, Tenn — The $190 million Grand Hyatt hotel, part of the One Beale project overlooking the Mississippi River, is a dream that might not come true.
The 350-room luxury Grand Hyatt hotel is a highly anticipated crowning jewel addition to the Bluff City’s skyline but it may not happen, the project's developer said Wednesday.
In a letter to Memphis Mayor Jim Strickland, the primary developer for the project, Chance Carlisle said the bonds needed to finance the project were expected to bring in $46 million but only brought in $41 million.
Mayor Strickland refuses to make up the difference.
“City government cannot be an ATM for developers. If it’s $5 million short, he needs to come up with that $5 million himself," Strickland said.
President of the Downtown Memphis Commission and candidate for mayor, Paul Young, is hopeful a resolution can be reached soon. He said the funding shortfall is a domino effect from the overall economy.
“Our whole country is undergoing difficult economic times; real estate is having a tough time with the interest rate growth," Young said.
Although the city giving more money is ruled out for now, the project is not.
“I still hope it happens," Strickland said. I hope the developer or the developers reach in their own pockets and come with five million dollars and get this thing done.”
While the Grand Hyatt project is on hold, more new hotels are in the pipeline.
“There’s still great economic activity happening downtown," Young said. There are a number of major projects currently under construction. One that’s just adjacent to it at the Mobility Center, that our team has been working on. So we still feel good about the future of downtown.”
A New York developer is planning a $100 million, nearly 200-room “Dream Hotel” at the corner of Main Street and Peabody Place and also an expanded Sheraton Hotel. The Sheraton would add another 300-room tower to the existing hotel attached to the convention center which would make it a 900-room hotel. That project is valued at $226 million and last month, landed a major tax break to move forward.
The Memphis Chamber of Commerce said in a statement to ABC24, “We know there is strong demand for more hotel rooms in Memphis. As a city, we must make sure we are doing everything we can to prioritize economic development.”