Friday, February 24, 2012

The Mansion to be Reflagged Mandarin Oriental, Vacant Craft Space to Become Del Frisco's Grille ?


Mandarin Oriental will soon open its first hotel in Atlanta.  Announced in 2008 to be opening a new property in midtown, Mandarin will instead open in Buckhead, and will reflag The Mansion on Peachtree.  Sources tell me this conversion may take place as early as mid-April. The Mansion has struggled since opening in May, 2008, and from foreclosure, it was sold at auction to iStar
Financial in  February 2010 for $66.1 million.,  nearly 65%less than the $187.4 million in estimated total loans on the project.

Hong Kong-based Mandarin Oriental announced a partnership with Atlanta-based Tivoli Properties in 2008 that would create a new Mandarin Oriental in 2008 in midtown, to be opened in 2011. Amidst a souring economy, troubling real estate figures and financial trouble at Tivoli, the hotel was never built and in February 2010, the land purchased for the hotel at 1138 Peachtree Street was foreclosed on.   Mandarin's hotel in midtown was to have 198 rooms and 71 residences within an all glass 53-story building.  The Mansion is a  42-story tower with 45 condos and 127 rooms.  Though not the same size or same appearance, the Mansion offers a dynamic location in the heart of Buckhead in addition to desirable in-house amenities like 29 Spa.  The hotel was designed by noted American architect Robert A.M. Stern and does not look like just another new hotel. 

The Mansion opened with three restaurants. NEO, a contemporary Italian  restaurant and craft and craft bar, is in an adjacent two story building in front of the hotel.  Craft and craft bar were brought to Atlanta by Top Chef judge Tom Colicchio, but neither performed well, and both closed in early 2011.  Coliccio, like other out-of-town chefs like Wolfgang Puck and Emeril Lagasse, have failed in Atlanta, where most diners will try a celebrity chef's restaurant once or twice, but then tend to gravitate back to local restaurants with local chefs.  I see a similar problem ahead for Southern Art at the InterContinental Hotel, where Art Smith is "the chef," but is only in town a few days out of the year.

Recent chatter indicates Dallas,Texas-based Del Frisco's is in talks to open what will be its third Del Frisco's Grille in the former craft and craft bar spaces, a 10,000-square-foot mammoth of a space.  Nearly every restaurant group from Atlanta has toured the space and no one went forward with anything.  Bob Amick of Atlanta-based Concentrics was one of those to look at the space.  I asked him about it and his response was "it's huge,  what am I gonna do with two kitchens?"  There is no doubt the space is well located, but the building is pretty darn ugly and as basically everyone in the restaurant world would agree, is too big.  Given Del Frisco's Grille is more or less just another out of own bar & grill, I'm hesitant to think it has any better chance at survival than the likes of 5 Napkin Burger in midtown, who is already struggling and has lowered menu prices at least once already.  The closure of Morton's Steakhouse across the street from the Mansion should serve as a warning to anyone looking to open a restaurant. Simply put, Atlanta, and Buckhead especially, has enough restaurants, especially steakhouses.

Del Frisco's currently operates 30 restaurants in 18 states, including its signature Frisco’s Double Eagle Steak House. Atlanta-based the Johnson Studio designed the Del Frisco's Grille in New York and presumably would be tasked with re-imagining the vacant Craft space here in Atlanta.   Last month the company filed papers for an initial public offering (IPO) at a time when many food service stocks are struggling or are being taken private by investment groups. 

InterContinental Hotels Group, with its North American headquarters in Dunwoody, as well as both The Ritz-Carlton and Peninsula hotels, have each expressed interest in erecting midtown hotels, but nothing was ever built.  InterContinental was the only hotel to officially announce development partners and a location but the site sits empty and I'm told the hotel is currently "off the books."  Donald Trump's Trump Towers were also to be built in midtown but never were.

A number of other hotels have reflagged in the past year including the  W Perimeter, the very first W ever to lose its flag, now operating as the Atlanta Perimeter Hotel & Suites. Kimpton's Hotel Palomar in midtown was reflagged as the Renaissance last year, and the aging building the Renaissance vacated downtown became the Melia hotel.  Additionally, the Hotel Indigo downtown was reflagged under Marriott's Courtyard brand just weeks before opening.  Most recently, Decatur's Holiday Inn was reflagged a Courtyard property and received an extensive renovation of both guest rooms and public spaces that make it look far better than in its prior life.

Closer to the Mansion,  Hilton expressed interest in the land adjacent to the Mansion where the Christian Science Bookstore had been as well as a number of smaller parcels behind Maggiano's and in front of Post Stratford.  The planned 48-story  tower announced in 2006 was to include 300 guest rooms and 192 residences.  The hotel was to be completed in 2009 but the land remains untouched and I presume the deal is dead.

Dallas, Texas-based Rosewood Hotels & Resorts does not have the cache that Mandarin Oriental has in the hotel world.  The Mansion is a beautiful property but a bit cramped if you ask me.  As I myself work in the hospitality field, I will say their rank as 1 on TripAdvisor is quite impressive.  The InterContinental was ranked number 2 in Atlanta as recently as early 2009 and has since plummeted to 11 while the St. Regis sits at 5 and The Ritz-Carlton Buckhead remains in the top ten at 9.  The list includes 197 hotels in the Atlanta area and is ranked based on guest reviews of the hotels.

I've visited Mandarin properties in Boston, Las Vegas and New York, and they are simply breathtaking. Their largest presence is in Asia, where they are based, but they are slowly expanding in the U.S.  InterCon, a step below Mandarin, has been doing the same with the additions of new properties in San Francisco, Boston, New York - Times Square in the last five years or so.  The Ritz-Carlton is staying small though they opened a LEED certified property in Charlotte, and recently opened their residences in Buckhead near Phipps Plaza.

Mandarin Oriental already has a development office here in Atlanta on 10th Street, though its main north American offices are in New York.   West Paces Hotel Group, now known as Capella Hotels & Resorts, founded by former Ritz-Carlton lead man Horst Schulze,  is based here in Buckhead and briefly expressed interest in the Mansion space

Personally, I was hoping for something a little more creative and special to open in the space. Mandarin Oriental has a reputation for being the best of the best in hotels and I gotta say, Del Frisco may be good but it does not carry the cache that Mandarin does. Neither the Mandarin nor the Del Frisco deals are completely done so perhaps there will be more developments in the coming weeks.

What do you think?  Does Buckhead need more " bar & grill " or steakhouse concepts?  Do like the idea of the Mandarin Oriental taking over the Mansion?  What is your favorite hotel in Atlanta? Why?

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10 comments:

SB said...

That restaurant doesn't in any way match up with the image of Mandarin.... I guess the hotel has no say over who goes in that space out front?

Atlantan99 said...

@Scott,

I certainly hope so!

jonc said...

I wonder if Bob Stern was responsible for the design of the restaurant building that fronts Peachtree. I've always found it extremely disappointing, especially considering his body of work.

The Frugal Hostess said...

No, Buckhead does not need another steakhouse! But they seem to be what perform best in hotels. I'm surprised Mandarin would want to enter an already over-supplied market without a lot of luxury demand.

Anonymous said...

Del Frisco's Grill is different from the Del Frisco's Double Eagle Steakhouse...

Atlantan99 said...

@Anon,

Correct, Del Frisco's Grille is a more caual version of Del Frisco's Double Eagle Steakhouse. The Grille concept is what is being planned for the Craft space. Personally, I think the concept looks like a step up from Houston's and really nothing special. I hate to predict a failure already but I don't think the restaurant makes much sense, especially in that (large) location and given the similar options already in the area.

Thanks for reading and for the comment!

Anonymous said...

Well Houston's is pretty popular and not extremely expensive... so I don't see how this would automatically be a failure? Geez...

Anonymous said...

W Sydney was the first W to lose its flag. Steakhouse concept at a Mandarin does not excite me... not even a little bit.

Anonymous said...

"Amidst a souring economy, troubling real estate figures and financial trouble at Tivoli, the hotel was never built and in February 2010, the land purchased for the hotel at 1138 Peachtree Street was foreclosed on. "

Just a correction-- the original site of 1138 peachtree st. is still owned by tivoli and was not (successfully) foreclosed on. The lender tried to foreclose, but tivoli successfully challenged and won (with huge damages awarded).

Anonymous said...

I think the Manderin taking over is a good thing and will add some sparkle to the area.

Del Friscos may do very well here. I just went to the one in Charlotte and it was jam packed.

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