On Friday, Rob Schaedle opens a 10-story Hampton Inn & Suites at downtown Nashville’s Capitol View development along Charlotte Avenue and I-40.
Schaedle, the founder and president of Franklin-based Chartwell Hospitality, couldn’t control the timing — construction started two years ago and is now ending in a pandemic. But Schaedle said his business, with almost 2,000 rooms in Greater Nashville and hotels in 12 other states, is built to withstand the current downturn.
“We’ve got a lot of money invested in this industry. We’re not going anywhere,” Schaedle said. “It will take some time, but the business will turn, and we’ll be ready. … We fully expect [Capitol View] to outperform its competitor set in the downtown core.”
Chartwell is on course to open a hotel in Cool Springs by year’s end, and the company is developing the luxury Conrad Hilton hotel in one of the two towers at the $540 million Broadwest project at 1600 West End Ave. In June, Chartwell secured a construction loan for a dual-branded hotel within GBT Realty Corp.’s Parke West project, on Murphy Road between West End Avenue and I-440.
I spoke with Schaedle just before the July 4 holiday weekend. This Q&A has been edited for clarity and length.
How would you contrast your outlook today versus where things were in March? In March, we were all reeling. All our heads were spinning. We’re in 12 states … and you had occupancy go from 80-something-percent to less than 10% in a week. I had 2,000 employees the first week of March. We laid off 1,700 people. We’re bringing them back slowly. Today we’re somewhere between 35%-40% occupancy. We watch that number daily, and we see it inching up.
What source of business will be first to come back? Leisure travelers. We have a property in Pigeon Forge that’s running at 95% occupancy. The panhandle of Florida looks like there’s never been any incidents of Covid, there are so many people down there. Seaside, Gulf Shores, they’re packed. Of course, that’s a double-edged sword.
Then you have business travel and group events such as conventions. The core group of demand in the hotels we do is business travel. Corporations basically shut that down, but we’re starting to see it percolate a little bit. It’s not by any means an onslaught, but it’s happening. When you go into the fall, leisure kind of falls off a little bit, and you’re anchored by your business travelers and your groups. Everybody is still trying to figure out both of those elements of demand right now. I have to say, booking for late July, we sold over 100 rooms last night and the night before at our Hilton here at Meridian [in Cool Springs]. That’s really good.
What does recovery look like? Recovery breaks down into two components. There’s occupancy: A lot of experts think we’ll get back to pre-Covid in late 2021, and we’re kind of buying into that model. You also have to see what rates are going to do. Obviously, there’s a softness. People are taking whatever they can get. Rates will probably lag … into 2022, to get to pre-Covid levels.
That is the year Parke West is set to open. We got [financing for] Parke West done at the epicenter of the worst time in the world, so we’re extremely excited about that. This ought to be behind us by the time this project opens. If you believe in a market, this is a good time to be under construction. That’s about as primo of a real estate location as you can get: You’re on 440, and you go down West End into downtown. The visibility’s incredible.