Downtown hotel boom looming
Several proposed projects could bring at least 700 new hotel rooms to Downtown Jacksonville.
“There’s a lot of exuberance there,” said Aundra Wallace, CEO of the Downtown Investment Authority.
Wallace said Downtown needs more hotel rooms and space for large groups, business travelers and tourists.
He reacted to recent announcements that signal a change in Downtown’s lodging landscape that includes a plan to transform the unfinished, vacant Berkman Plaza II into a hotel.
An undisclosed developer purchased the blighted, half-built condominium property Monday with plans to make it a hotel with riverfront entertainment space, according to Mayor Lenny Curry.
“I’m glad they finally closed,” Wallace said.
Wallace declined to identify the buyer but said he was “looking forward to sitting down and working out the details of their plans.”
It’s the first sign of movement for the unfinished structure since Choate Construction Co. acquired the property in 2014.
The Berkman Plaza II was designed as a 23-story, 222-unit condominium. Construction stopped at 18 floors in 2007 following the collapse of an adjacent parking garage.
As of Wednesday afternoon, the buyer had not recorded the deed with the Duval County Clerk of Courts. Choate representatives did not respond to calls and emails.
The Berkman Plaza II is one of several hotel projects Downtown.
Augustine Development Group plans to redevelop the historic Ambassador Hotel along North Julia Street.
The group wants to develop 100 hotel rooms there and build a 200-unit apartment complex and 15,000 square feet of retail space next to it.
Wallace said he spoke with Augustine Development’s Bryan Greiner and George Bochis before they bought the 1.5-acre property for $5.4 million.
“When they first sat down, they were focused on the Ambassador,” Wallace said. “I asked them to consider having a residential component and I’m happy that’s what they’re considering.”
Augustine Development confirmed Cambria and La Quinta as two hotel companies being considered.
In Brooklyn, just outside the urban core, Parkview Plaza Partners LLC proposes a 135-room Residence Inn by Marriott along Forest and Magnolia streets.
The Downtown Development Review Board, which oversees building standards for the Downtown area, must approve the project.
“That can serve people who are looking for an extended stay, in an area that desperately needs a hotel product,” said Wallace.
While those ideas are still in the early stages of development, others are ready to break ground.
On July 14, Elements Development of Jacksonville LLC closed on the site slated for a mixed-use project called The District, which will feature a 200-room AC Hotel by Marriott, a new flag for Jacksonville.
The Southbank District is set to break ground next year for more than 1,100 residences, 200,000 square feet of retail space and 200,000 square feet of office space.
According to the AC Hotels website, the boutique brand draws inspiration from European design with modern amenities and a “social buzz.”
On the north side of the St. Johns River, another Marriott flag is proposed for the Laura Street Trio at northeast Laura and Forsyth streets.
A 145-room Courtyard by Marriott is planned there as part of a $95 million project by SouthEast Development Group and The Molasky Group of Companies.
Across Laura Street, the venture is redeveloping the Barnett Building, which will have apartments, offices, a University of North Florida satellite campus and ground-floor banking.
Developer Steve Atkins of SouthEast said previously the hotel will be a custom-build for Marriott.
Along with a new eight-story structure, the hotel will occupy space in the Florida Life and Bisbee buildings, which flank the Marble Bank Building.
Not far from there, at Laura and Bay streets, developer Eugene Profit wants to transform the former Life of the South Building into the 89-room Hotel Indigo.
It will feature a rooftop restaurant and lounge with ground-floor retail. Profit expects to break ground this year.
Wallace said the momentum in 2018 is a sign of what’s to come.
“I think developers are reacting to the market and the demands of a city that’s growing its events and sports profile and entertainment business,” he said.
Wallace said Downtown can benefit from having multiple Marriott flags.
“Business travelers come to Jacksonville all the time, and they’re looking for brands they’re comfortable with such as Marriott and others,” he said. “They’re always trying to accumulate points.”
Wallace is not concerned about too many hotel rooms.
“The hotels for the most part aren’t asking (the DIA) for incentives, outside of two of the projects,” he said, referring to the Laura Street Trio Marriott and the Residence Inn in Brooklyn.
“What that tells me is they’ve looked at the market and they’re comfortable moving forward because they believe they can get the room rates and occupancy they need to survive,” Wallace said.
Katie Mitura, vice president of marketing for Visit Jacksonville, said the announcements are no surprise.
“We’ve had a huge uptick in the number of developers who’ve reached out to us looking for research and insight on the market,” she said.
“Those calls are coming in every day,” Mitura said.
Visit Jacksonville is the city’s convention and visitors bureau. It contracted with the city for marketing and recruiting conventions to Jacksonville, among other responsibilities.
Mitura said projects like the Ambassador Hotel are happening across the country.
“These vacant, historic buildings are very popular in other cities when they’re turned into historic hotels and repurposed,” she said. “People love the atmosphere.”
Mitura said June was the 57th consecutive month of hotel occupancy and room rate growth in Jacksonville.
She credits that to increased advertising, visibility and a growing business community.
“Jacksonville’s also becoming a more well-known leisure destination,” she said.
Mitura said a missing component is a new convention center large enough to satisfy the growing national convention industry.
“Right now, the largest space we can house anybody in is the 78,000 square feet of space in our current facility,” she said of the Prime F. Osborn III Convention Center.
She said most group meeting prospects need about 200,000 square feet of exhibition space and more hotel rooms than Jacksonville can offer Downtown.
The new projects would join the roughly 1,000 hotel rooms on each side of the river Downtown.
Two full-service Northbank hotels – the Hyatt Regency Jacksonville Riverfront, at 951 rooms, and the Omni Jacksonville Hotel, at 354 rooms – dominate Downtown lodging.
On the Southbank, the Lexington Hotel & Conference Center Jacksonville Riverwalk and the Doubletree by Hilton collectively operate more than 600 rooms.
Four limited service Southbank area hotels account for more than 400 additional rooms.
Visit Jacksonville reported for June that occupancy at Downtown hotels was up almost 10 percent year-to-date to 75.2 percent.
Even more rooms
Two more hotels are envisioned for Downtown.
The city is accepting proposals from companies to demolish the old City Hall and Duval County Courthouse and from investors that would replace the buildings along East Bay Street and the St. Johns River with a convention center and a 200-room hotel.
Those plans may change depending on what’s submitted.
“I bet there would be two to three times as many groups that we could be courting to come to Jacksonville if we had that,” said Mitura.
“It would be transformative,” she said.
Near TIAA Bank Field, Jacksonville Jaguars owner Shad Khan proposes reconfiguration of the western parking lots, including Lot J.
His vision is a new entertainment district with a hotel, although specific details aren’t known.