MEMPHIS, Tenn. — There are some not-so-grand plans for the Grand Hyatt Hotel in Memphis. The project’s developer says the project appears dead, and he blames the city, saying delays by the city may have sunk the project.
When talking about the Grand Hyatt Hotel project being stalled, Memphis Mayor Jim Strickland placed the blame squarely on the developer.
“I think the developer’s chosen not to go forward with the project as I understand it,” Strickland said. “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.”
The Grand Hyatt was supposed to be a 350-plus room hotel intended to serve the recently renovated Renasant Convention Center. Chance Carlisle, the project’s principal developer, said there was a $5 million shortfall.
Strickland says Carlisle dropped the ball.
According to a timeline of events included in a letter Strickland sent to Carlisle, Carlisle reportedly called the City of Memphis Chief Operating Officer on September 28 and said, “It’s over, I am out of time, I am telling my contractor to demobilize.”
Strickland’s letter also claims that two days later, on September 30, Carlisle’s attorney began making multiple calls to the COO suggesting that Carlisle may have wanted to move forward with the project.
“While the developer was on spring break in Colorado, we were meeting with state officials to approve his deal, got approval in early April by city council, and they did nothing, nothing,” Strickland said. “The city has offered more incentives for this hotel than any project that I know of in our history.”
According to the letter Strickland sent Carlisle, those incentives included a 30-year PILOT and two forms of revenue that would’ve been dedicated to paying off the bond debt used to help finance the project.
Strickland estimated the overall value of the public incentives is $300 million.
Some city council members agree with Strickland.
“I’m one who’s for more development but having such a deal like that based upon the original structure of this, we would have to carry the liability,” said Councilman Martavius Jones.
Tourism leaders admit they’re disappointed.
“We certainly have a need for large full-service hotels, especially in the downtown area near the convention center. So, it’s disappointing the Grand Hyatt has stalled,” said Kevin Kane with Memphis Tourism.
As for the mayor, he says the deal can still happen.
“I hope the developers reach into their own pocket and come up with $5 million to get this thing done,” Strickland said.
Carlisle responded to WREG late Thursday, blasting the mayor:
“I hear Colorado is wonderful. I haven’t been in over 10 years,” Carlisle’s response read. “I am not surprised Mayor Strickland is attacking me personally or getting the facts wrong. He has nothing else. His administration is covering up and misleading the public. Like in May, the Administration caused delays that prevented us from moving forward. Our investors cannot bail out the Administration every time they make a mistake.”
The Greater Memphis Chamber released a statement from Chief Economic Development Officer and incoming President Ted Townsend:
“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 that will unleash our growth potential. It’s important to have business leaders like the Carlisles engaging in this public process, and we will continue to support developments that move Memphis forward.”