In March, Hilton Worldwide began construction on its first Tru by Hilton hotel, choosing to plant the seeds of the brand in McDonough, Ga. The Tru brand was revealed in January, and at the time Hilton claimed it had 102 hotels signed with 30 more undergoing approval. Now, with its first hotel’s location staked out and aiming for a summer 2017 opening, the 98-room hotel represents an unusually fast transition from brand announcement to the start of construction just eight weeks later.
Pete Patel, owner of McDonough Hotel Partners and owner of the future Tru by Hilton McDonough, said that Hilton was always the group’s first choice for the property it had in mind for the town. McDonough Hotel Partners owns a Hampton Inn near the Tru development site, and wanted to ensure that its next project wouldn’t compete with the existing facilities. Patel also said the town’s location nearly 30 miles south of Atlanta and its position as a major transit hub for the city and other surrounding attractions made it an ideal setting for a new midscale hotel.
“The midscale offering is nice for cost-conscious travelers coming to nearby Atlanta,” Patel said. “On top of that, the Hilton name holds traveler attention and its reservation system and Hilton HHonors program are attractive for us as operators.”
While Hilton was the first company Patel’s group had in mind, Tru was not the first brand. “We were talking to [Hilton’s] development team and we were looking at other brands before Tru, but we quickly knew this was the brand we were going to go with,” Patel said. “[Hilton] was trying to make the deal as simple as possible; they made it cost-conscious and secured us some development perks.”
Remember the Name
At press time, the final tally of the financials behind the deal had not been settled, though McDonough Hotel Partners worked with a regional bank to finance the project, something Patel referred to as a learning process for both his company and the lenders involved.
“They love the Hilton brand name, and that made life a lot easier when it came to financing,” Patel said. “There were some reservations at first from the lenders, but we showed them our presentation and once we got them to see what we were seeing, they were on board.”
Patel credits Hilton’s name recognition and McDonough’s good reputation with the bank as contributors to finding lending success, which he said was necessary when seeking investment in a new brand. “Boutiques and new brands struggle on some level at this phase, because banks aren’t receptive to the risk involved,” Patel said. “That’s why it pays to have a relationship, or, in our case, the brand name.”
Work and Play
The development site for the property is two acres in size, and as the first Tru hotel, it will adhere to the concept’s prototype of 98 guestrooms across four stories. All told, the hotel will be 48,000 square feet, and will be located near Interstate 75, 24 miles from Hartsfield-Jackson Atlanta International Airport.
One of the draws of the Tru brand is its open lobby consisting of four zones designed individually for lounging, working, eating and playing. Tru hotels offer mobile check-in and a digital key service through the Hilton HHonors mobile app, and the property will have a fitness center and Wi-Fi bandwidth capabilities that Hilton has dubbed “segment-leading.” The hotel will also have a “build your own” breakfast station and a front desk that Hilton is calling a “command center” that moonlights as a 24/7 market.
All New Everything
It’s not uncommon for the first hotel in a new brand to be a new-build, and Patel said he expects Hilton to focus on growing the brand through new developments as opposed to conversions.
“As a franchisee, their primary focus will be on going with all new-builds,” Patel said. “They may use adaptive reuse hotels in markets with a higher barrier of entry, but as an owner and developer it makes me feel good to know Hilton is focusing on consistency with this brand. It’s important for driving customer recognition.”
If Patel could change anything about this project, he would have the hotel open right now in order to take advantage of the favorable hotel market in McDonough. “With Hilton helping us out, we wanted this project on the fast track,” Patel said. “We know the market here very well; it’s strong right now and it just made sense for Hilton to bring Tru here.”