Chattanoogan Hotel To Be Sold By City To Lexington, Ky., Hospitality Group For $32 Million

Monday, October 23, 2017

The city has reached agreement to sell the Chattanoogan hotel for $32 million.

The buyer is Schulte Hospitality Group of Lexington, Ky. The firm has 102 hotels in 26 states.

Daisy Madison, city chief financial officer, said the proceeds would be enough to pay off all the city's remaining debt for building it.

She said there had been interest in buying the hotel before, but the city held off until it had an offer that would satisfy all the debt.

Ms. Madison said the city will save $30 million in interest costs over the next 13 years. 

The PFM public consulting firm had worked since July in finding a buyer.

PFM officials said they believe "we got to a market price for the building."

They added, "Taking this debt off your books is a big deal. This puts the hotel back on the tax rolls. That in itself is $650,000 a year in real estate taxes."

Tom Morsch of PFM said the price was around $160,000 per room. He said new hotel construction is about $220,000 to $230,000 per room.

The property was shown to around seven groups and there were three finalists.

The price went up about $1 million from the first round of bidding to the final, it was stated.

The group is making a $750,000 down payment. The city will pay the closing costs.

There will be 30 days of additional due diligence and then it will close within 15 days.

Benchmark Hospitality, which last year merged with Gemstone Hotels & Resorts, has long operated the hotel and conference center for the city.

The city built the hotel at 12th and Broad with a focus on it being a conference center, though there was some opposition to local government getting into the hospitality business and competing with private hotels downtown.

The Chattanoogan initially had some financial difficulties, but has been profitable in recent years as the debt for constructing it has been reduced.

It features 199 guest rooms and suites, a day spa and 25,000 square feet of conference space. It also features three restaurants.



Latest Hamilton County Jail Booking Report

Here is the latest jail booking report from Hamilton County: ARIAS, DAVID SALAZAR  3803 10TH AVE APT B CHATTANOOGA, 37402  Age at Arrest: 36 years old Arresting Agency: Hamilton County Booked for Previous Charges or Other Reason(s) --- ASHLEY, CHARLES LARRY  2626 MOWBRAY PIKE SODDY DAISY, 37379  Age at Arrest: 36 years old Arresting Agency: ... (click for more)

Teacher Charged With Growing Marijuana Pleads To Reduced Charge

A Lakeview-Fort Oglethorpe High School teacher who was charged with growing marijuana with intent to distribute it has pleaded guilty to a lesser charge of possession of marijuana. Other counts were dismissed. Officers of the Lookout Mountain Judicial Drug Task Force in early July searched the home of Lori Beth Moore after getting a tip that she was growing marijuana. The ... (click for more)

Arming Teachers With Guns Will Be Too Dangerous - And Response (4)

Arming teachers with guns in the classroom, as Bill Lee proposes, would be the single most dangerous thing to happen to students in Tennessee history. Students and teachers in close proximity to loaded firearms daily? Across this state, in middle schools alone, there are probably hundreds of student/teacher conflicts a day. What if a student got hold of gun in a struggle with ... (click for more)

Roy Exum: Dumb Ain’t A Crime

As half of America wonders how a Texas school superintendent still has a job, the other half of the country now understands that being dumb is no crime. Minutes after the Houston Texans dropped a ugly 20-17 loss to the Tennessee Titans on Sunday, an upset educator – obviously with a full head of steam -- pounded this sentence out on his Facebook page: “That may have been the most ... (click for more)

Central Ends Good Week With Win Over East Ridge

Central volleyball coach Holly Ware saw on the Lady Pounders home court Tuesday  night what the second-year coach had seen in her mind for most of this volleyball season.   “Our numbers are not impressive, but they also don’t show what I know this team is capable of being. It has been an emotional roller coaster this year from one game to another, one match ... (click for more)

Inspired Chattanooga Christian Sweeps Notre Dame

Chattanooga Christian and Notre Dame have built a really good rivalry in recent years, especially in volleyball. Notre Dame had the dominant team for many years before the two teams split regular-season matches a year ago. Chattanooga Christian has the upper hand in 2018 and clinched first place in the district on Wednesday night at Notre Dame’s Jack Steiner Gymnasium with ... (click for more)