Plans for new downtown hotel delayed amid construction cost concerns

The downtown Hampton Inn planned for the 1200 block of Broadway is being delayed as the developer works through higher than anticipated construction costs.

An 88-room hotel at the corner of Broadway and 12^th Street has been in the works for about a year, but the project has slowed down considerably as the Pezold companies wait for new project construction bids next month, Pezold Management Chief Operating Officer Tracy Sayers said Tuesday.

“I am still confident and optimistic we will get there, but we are waiting right now to make the call,” Sayers said.

The construction costs have come in at more than $12 million, Sayers said.

“Right now, construction costs are at a premium,” Sayers said. “If you are looking at $110 a night room rate, you can’t get the return you need with $12 million for construction. No matter how much you spend, it only works if you can generate the revenue needed to support the project.”

The project was announced last June when Jack Pezold, a local businessman and hotel developer, was awarded the Hampton Inn franchise for downtown Columbus by Hilton Worldwide.

The original plan called for a combination of renovation and new construction for a 60-room hotel on the site of the former Aaron’s Rents building. That was revised late last year to tear down the current structure and build a new 88-room hotel with the possibility of a roof-top conference center.

Valley Hospitality, a Pezold company, will operate the proposed new hotel, which is a Hilton property. Valley Hospitality currently owns and operates the downtown Marriott at the corner of Ninth Street and Broadway. The company owns six hotels in Columbus and LaGrange.

The proposed downtown Hampton Inn one of two hotels being planned for the 1200 block of Broadway.

Last December, Columbus-based RAM Hotels finalized the purchase of the Raymond Rowe property at 1225 Broadway. Their plans call for a 106-room AC Hotel, an upper end Marriott property.

Demolition of the 1225 Broadway building, on the same side of the street as the proposed Hampton Inn project, should begin this summer, said Rinkesh Patel, president of RAM. The projected opening for the hotel is late 2018, Patel has said in previous interviews.

RAM owns and operates the Courtyard Marriott just across the 14th Street pedestrian bridge on Whitewater Avenue in Phenix City.

This story was originally published April 25, 2017 at 1:03 PM with the headline "Plans for new downtown hotel delayed amid construction cost concerns."