Posted 12/2/2013 12:00 am
Updated 8 months ago
Another hotel-minded venture intends to make its mark on the downtown Little Rock skyline. Pinnacle Hotel Group will develop a 135-room Hilton Garden Inn at the northeast corner of Fourth and Cumberland streets.
Construction of the seven-story project is expected to start in a year, with a planned opening to follow in March 2016. The $16 million development represents PHG’s most ambitious endeavor to date.
The hotel will employ 50 and house nearly 4,000 SF of meeting space and a full-service restaurant and bar named The Garden. The Hilton Garden Inn leads a $43 million quartet of projects the Little Rock hotelier will start rolling out around the state during the next 15 months.
Construction of a Courtyard Marriott is starting this month in Hot Springs. The 98-room project should be open by January 2015. Construction of a 97-room Holiday Inn & Suites in Russellville and an 85-room Holiday Inn Express in Bryant is slated to begin in spring. Both projects should be operational by winter 2014.
“We’ve got our pipeline mapped out for the next 60 months,” said Chet Patel, president of Pinnacle Hotel Group.
During the five-year window, the company expects to see its portfolio grow to at least 10 hotels. That will be accompanied by an increased staffing head count from 85 to more than 200.
By mid-December, PHG is scheduled to begin a $2.1 million land assembly process for the Hilton Garden Inn development along the north side of East Fourth Street between Cumberland and Rock streets.
The parking lot on the west half of the property represents the hotel site.
The east half is currently home to Rock Street Shops at 310-324 Rock St. Pinnacle Hotel Group will relocate its offices to the 8,322-SF project in January.
Once the Hilton Garden Inn is completed next door, the company will move to new quarters there.
Rock Street Shops will be demolished and converted to an 86-slot parking lot to support the hotel.
“I think it’s pretty exciting,” Montine McNulty, executive director of the Arkansas Hospitality Association, said of PHG’s downtown project. “Of course, it means increased competition.”
McKibbon Hotel Group Inc. of Gainesville, Ga., is in the early stages of developing its fourth downtown Little Rock project, near the Hilton Garden Inn site.
The company’s 115-room Hilton Homewood Suites, an extended-stay offering, will be built on the south side of Fourth Street between River Market Avenue and Rock Street.
McKibbon’s previous projects in downtown Little Rock include the 120-room Marriott Courtyard, opened in 2004 at 521 President Clinton Ave.; the 119-room Hampton Inn & Suites, opened in 2008 at 320 River Market Ave.; and the 107-room Residence Inn, opened in 2013 at 219 River Market Ave.
The roots of McKibbon, which owns or operates 75 hotels located primarily across the Southeast, go back to more than 65 years to 1946.
Pinnacle Hotel Group, which owns six Arkansas properties, was formed in 2007 by the merger of three hospitality families orchestrated by second-generation leadership.
The corporate effort may be only six years old, but the involvement of the PHG families in the business dates back three decades with separate mom-and-pop motels in Clarksville, Crossett and Malvern.
Two of the families are represented by a trio of PHG executives: Chet Patel, president and controller; Shawn Govind, director of development; and his cousin, Rocky Govind, director of operations.
They got to know each other as students at the University of Arkansas at Fayetteville, where Patel majored in accounting and finance, Shawn Govind in real estate and finance and Rocky Govind in computer science.
“Through association in college, we all became buddies,” Patel said.
That friendship and the shared heritage of growing up in the motel business with immigrant Indian families provided the launching pad to join forces and eventually start Pinnacle Hotel Group.
Rounding out the operational leadership is a family friend, Nick Nagin, PHG’s director of procurement & purchasing. Nagin grew up in Mississippi and moved to Arkansas in 2000.
He made his first hotel investment in 1997 with a Hampton Inn in Conway and later followed that with his first development: a Comfort Inn in North Little Rock.
Nagin’s brand relationships were important door-openers that facilitated the formation of Pinnacle Hotel Group. The first joint venture by the PHG families began in 2001.
“Everyone kind of did their own things until then,” Chet Patel said. “The whole idea is to bring in economies of scale and bring the whole thing to another level.”
The Country Inn & Suites in Fayetteville opened in 2003 and was rebranded as a Comfort Inn Suites in 2011.
“It was quite an experience,” said Shawn Govind. “It was our first big deal.”
Bigger deals followed and culminated in the 120-room Hilton Garden Inn at 4100 Glover Lane in North Little Rock. The company’s first full-service project was sold in August for $13.1 million.
For now, PHG’s flagship property is the Holiday Inn at 10920 Financial Centre Parkway in west Little Rock. The previously unbranded project underwent a nearly $5 million renovation that transformed it and introduced a new Holiday Inn look to the market.
The Hilton Garden Inn in downtown Little Rock will supplant it as the group’s signature project.
Among the early chores needed to make the hotel happen is relocating the on-site utilities underground.
Patel said the market conditions are ripe to expand and upgrade PHG’s holdings.
“Lending is starting to become a little more flexible,” he said.