MEMPHIS, Tenn. – The developer of the proposed Grand Hyatt says the city has failed again to deliver a convention center hotel and announced Monday the project was dead.
“We’ve invested a significant time. I’m not upset about the money we are losing. I’m upset that Memphis is losing a convention center hotel, and what’s the plan to restore it,” said Chance Carlisle. “The Grand is dead.”
Carlisle said he was also upset about the finger-pointing by the city as to who was to blame.
Last week, Memphis Mayor Jim Strickland said the developers had chosen not to go forward with the project over a $5 million shortfall.
Carlisle said over the last two years, the $92.5 million project has gone from an $8.5 million private contribution to $35 million, and the last five million was the breaking point.
“It’s September 23, and we have a deal. Then, three days later, they have to break that deal. That’s what caused the private contribution to go from $35 million to $40 .5 million, and that’s money we are paying for a public facility,” said Carlisle. “At what point do you say from us putting up $8.5 million to $40 million is enough?”
The Grand Hyatt was supposed to be a 350-plus room hotel with three restaurants and a 94,000-square-feet meeting space.
It would have also created a 735-room campus with the existing Hyatt Centric and the Caption by Hyatt Hotels.
In a letter, Strickland accused Carlisle of dropping the ball.
“City Government cannot be an ATM for developers, and if it’s $5 million short, he needs to come up with that $5 million himself,” said Strickland. “The city has offered more incentives for this hotel than any project I know in our history.”
Carlisle said he is all out of options, and if there are other ways to get the $5 million, it would have to come from Memphis, Shelby County government, or the state of Tennessee.
“I’m sorry if you think I can just write a $40 million dollar check,” Carlisle said. “Eighteen percent are local block investors. You cannot ask them to put in more money for a public shortfall that was not caused by them at all.”
Strickland estimated the overall value of the public incentives is $300 million.
Tourism leaders are disappointed about the status of the Grand Hyatt project and say the city needs a large full-service hotel near the convention center.
“If the answer is to build a new 6000-700 room hotel adjacent to the convention center, that is fine. It’s just going to cost a lot more money,” said Carlisle.
Carlisle said the site for the Grand Hyatt is still one of the best locations in the city, and they are still trying to decide what to develop on the property.