NATIONAL REPORT – Hard Rock International, a brand that is as much about the sounds as it is the sights guests experience during their travels, will join Atlanta’s music and tourism scene when it opens a new-build property there in 2018.
“When I was growing up, Atlanta was the center of the universe. It still is, musically,” said Dale Hipsh, VP hotel & casino operations development for Hard Rock International. “I have a lot of respect for the market, and [Hard Rock] has always been keen to get in.” Hipsh talks equal parts hotel and music pipelines when referencing Atlanta, making the brand’s newest upcoming addition, the Hard Rock Atlanta, seem like a natural fit.
“Tourism is going crazy in the city; it has really evolved and we are also excited about what is happening in the music scene,” he said. “The area is perfect for us because we, as a brand, have the ability to straddle the millennial, collegiate and corporate worlds.”
The property is located near Phillips Arena, the Georgia Dome and the upcoming Mercedes-Benz Stadium, the future home of the Atlanta Falcons. Hard Rock investigated entering the Atlanta market for roughly seven years before deciding on the ideal site.
Taking the reins
In addition, Hard Rock International is now stepping into the realm of property management. By the time the 220-room Hard Rock Atlanta opens in spring 2018, the company will have a number of hotels under its management umbrella, including one in Shenzhen, China, and another in Dubai. “While the Atlanta property won’t be our first managed property, it will follow the others,” Hipsh said. “We would rather have managed our first property in Atlanta. If you want to do something complicated, open your first managed property in China.”
When asked why Hard Rock is just now stepping into the ring to manage hotels, Hipsh dipped back into the company’s history when it began as a cafe in 1971. “We slowly gained notoriety and acclaim for our ability to function in the hotel space,” Hipsh said. “We are keen, and our owners are keen, on leveraging the skills we have learned and putting them toward managing hotels. We have a better shot at realizing what we can do by expressing the brand DNA when we are at the steering wheel as opposed to the back seat. We have an ownership group now that believes in the brand, and a team that says we should be managing hotel properties.”
Hipsh said the company decided a new-build was necessary in Atlanta to provide the program it envisioned. “When we’re done, the property is going to have every part of the experience that we want we can squeeze into it.”
Gensler is designing the entire facility, which will include an outdoor swimming pool, rooftop location and multiple dining outlets. The property will also have the Rock Spa and a Hard Rock Cafe.
Funding, Other Markets
The hotel, when complete, will be part of the Castleberry Park development, which will also include residential and retail components, along with a park. The hotel’s developer is Bolton Atlanta LP; its GM, Frank Chen, said the entire Castleberry project is being partially financed via EB-5, a program created in 1990 to stimulate the U.S. economy through job creation and capital investment from foreign investors.
“EB-5 foreign investors will fund 60 [percent to] 70 percent of the total [Castleberry Park] project,” Chen said.
Under the EB-5 program, entrepreneurs (and their spouses and unmarried children under 21) are eligible to apply for permanent residence if they make the necessary investment in a commercial enterprise in the U.S. and plan to create or preserve 10 permanent full-time jobs for qualified U.S. workers.
Marco Roca, Hard Rock’s EVP and CDO, said the company also has its sights set on a variety of emerging markets outside of Atlanta. For domestic development, the company is pushing for a greater presence in gateway cities, such as New York, Miami, Los Angeles and Washington, D.C. However, Hard Rock is also zeroing in on cities where music is at the forefront of local culture, such as New Orleans, Nashville, Tenn., and Austin, Texas.
Internationally, Brazil remains of interest, while the company’s first hotel in India—the Hard Rock Goa—is slated to open this year. The Hard Rock Shenzhen, the brand’s first in mainland China, is also expected to open in the near future. Two other Hard Rock hotels are expected to open in Dubai and the Canary Islands in 2016.
“We have not yet penetrated Russia, but we expect to do so before the end of the decade,” Roca said. “As for other emerging markets, we are very bullish on Croatia, Indonesia, the Maldives, Colombia, Mexico and certain Middle Eastern countries, as well.”
Back in Atlanta, Hipsh is itching to get to work on the company’s next U.S. property. “The enthusiasm we have for the Atlanta project shows it’s the perfect fit for the neighborhood,” he said. “We just want to get on with it.”