South view of planned convention center hotel. Rendering provided by Phelps Development and Portman Holdings
Developers chosen this week to build a hotel that goes along with a new downtown convention center are working with Metro Government to pay for construction. The development team’s experience has been with public financing.
The 1,000 room hotel is expected to cost $300 million on top of the more than $600 million convention center.
Eric Wilson, who is president of Phelps Development, says a city typically puts up the bonds, but revenues from the hotel pay them off.
“In order to get the bonds rated so they’re marketable, the cities often will provide a revenue stream backup to support the hotel in the event there’s a shortfall in revenue.”
Wilson says his team is working to come up with the right model for Nashville, which could also include private investors.
Construction of the convention center is expected to be financed by tourist taxes already in place on hotel rooms and rental cars. Wilson says the hotel would not be built without the convention center, which has yet to be approved by the Metro Council.
The Metropolitan Development and Housing Agency has chosen a site behind the Country Music Hall of Fame as the preferred hotel location. Construction could begin as early as next year, with a planned opening of both the hotel and convention center in 2013.
On Air - 90.3 WPLN-FM