Nashville In Line For A Boutique Hotel Boomlet, If All The Plans Go Through

The inside of Portland’s Ace Hotel. The company is reportedly eyeing a site in Nashville’s Printer’s Alley. Credit: Kenn Wilson

A group of well-heeled investors has an acre of property in the heart of Printer’s Alley in downtown Nashville under contract. The developers are thinking about a boutique hotel there, just as several other similar hotels are being considered.

A 21C Museum Hotel is in the works on Third Avenue, and there are plans for another niche hotel on Union Street. This latest announcement, if it goes forward, would oust two dive bars and other colorful businesses in Printer’s Alley. Precise plans for the site have not been disclosed, but The Tennessean reports the Portland, Ore.-based Ace Hotel has been expressed interest.

Land broker Fred Kane with Cassidy Turley attributes the small hotel boomlet to the new convention center.

“And I think we have several years of these smaller boutique hotels coming online as our convention center business builds,” he said.

But Kane said not every boutique hotel announcement ends up actually breaking ground. Although he has a rosy outlook for boutique hotels in Nashville now, lenders often require loads of cash up front — sometimes up to 40 percent down — which can complicate or even sidetrack plans.

The reason is because the hotel business is tied to the ups and downs of the economy, meaning any small hiccup could cause room bookings to drop. Because hotels are a riskier proposition than apartment and condo projects, Kane says lenders have greater demands.

“It takes a good deal of capital to be involved in those hotels,” Kane said. “That’s just kinda the established hotel market.”

Fans of one of the businesses that might be kicked out, karaoke bar Lonnie’s Western Room, have started an online petition to stop the redevelopment, according to the Nashville Scene.