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Radisson Plans comeback in Atlanta

Atlanta Business Chronicle - July 26, 2010, by Lisa R. Schoolcraft


The Radisson hotel brand is considering a return to the Atlanta market.

Minnetonka, Minn.-based Carlson Cos. is “looking for potential Radisson development deals in the Atlanta market, including franchised and managed hotels,” said Joan Cronson, senior director of public relations and communications for Carlson. “We would like to have Radisson hotels in this key U.S. market.”

Radisson has been “on the ground for many months” looking at Atlanta and the 502-room Renaissance Atlanta Hotel Downtown in particular, said Sam Winterbottom, senior vice president and director of Hotels, Golf & Leisure for Grubb & Ellis Co. in Atlanta. Winterbottom has met with Carlson officials.

Renaissance, at 590 West Peachtree St. NW., is losing its brand on Sept. 30.

Carlson Hotels, with more than 1,080 locations in 77 countries, announced earlier this year “Ambition 2015,” a plan to expand its hotel portfolio by at least 50 percent to more than 1,500 hotels by 2015. It wants 600 Radisson hotels by 2015, up from 422 currently. Carlson plans to invest up to $1.5 billion on the effort.

Carlson is “in serious upgrade mode,” said Paul Breslin, managing partner of Panther Hospitality, a hotel consulting firm in Atlanta. “It’s a brand that is well admired in Europe and I think they want to have that same positive image here. And they want to grow.”

Radisson once had four hotels in Atlanta, including one downtown.

The Radisson Hotel Atlanta, which was at 165 Courtland St. N.E., changed to Sheraton Hotels & Resorts in 1999. The owner then upgraded the property and added meeting space, said Winterbottom.

Carlson, a global, privately held hospitality and travel company, has 20 Country Inn & Suites in metro Atlanta.

“There is a good opportunity to develop Radisson back to that same level [of four hotels] in distinct markets such as the airport, Midtown, downtown and Buckhead,” Cronson said. “There is also opportunity to develop several more Country Inns & Suites.”

Country Inn & Suites is in the mid-scale hotel segment without food and beverage. Carlson is also interested in developing its Park Inn brand, which is mid-scale with food and beverage, Cronson said.

Carlson also owns the Park Plaza brand.

Several hotel insiders have said InterContinental Hotel Group Plc (NYSE: IHG), with its North America headquarters in Atlanta, might be considering a Crowne Plaza at the downtown Renaissance site.

There are actually several hotel brands that have an interest in a downtown location, Breslin said.

“In the downtown market Fairmont [Hotels & Resorts], at one time, was aggressively looking,” he said.

Morgans Hotel Group Co., Kimpton Hotel & Restaurant Group LLC and Waldorf-Astoria Hotels & Resorts have all been looking at Atlanta at large, Breslin said. “And there are non-branded hotels, Worldhotels and Preferred Hotels, that are looking for great opportunities.”

Still negotiating
At the Renaissance, a decision has not yet been made on what brand will take over.

A spokesman for Berlin-based The Fundus Group, which owns the Renaissance, did not respond to inquiries about which hotel brands the owners are talking to.

Radisson parent company Carlson also owns, operates, franchises and licenses the restaurants T.G.I. Friday’s and Pick Up Stix.

Carlson, which has more than 1,000 restaurants in more than 60 countries, plans to add several hundred restaurants by 2015 as well, the company said.

Carlson’s aim in its hotel expansion will be through Radisson, to make it “a powerful, globally consistent, first-class brand,” the company said.

Radisson currently has 420 locations in 73 countries.

Carlson has already spent $350 million to align the Radisson brand in the United States to global upscale standards. That includes the development of the $125 million Radisson Blu Aqua in Chicago, which will be a flagship property for the brand.

The Radisson Blu is the company’s upscale brand that aspires to compete with the likes of Westin, Winterbottom said.

Another 50 percent of the existing Radisson portfolio in North America will align with the global upscale standards.

Radisson competes with IHG’s Crowne Plaza brand and Hilton Worldwide’s Doubletree brand, Winterbottom said.

“We have achieved marked success in our first 100 days of Ambition 2015 with this strong commitment to compliance, market-leading international growth, and a focus on revenue generation,” said Hubert Joly, president and CEO of Carlson, in a June 9 update on the plan. “While this is just the beginning of a five-year strategy, we have established an excellent foundation for growth and brand elevation within the industry.”

If Carlson puts a Radisson flag on the Renaissance hotel downtown, “Atlanta loses a higher-level flag on a tired asset in a B location,” Winterbottom said. “The big question is what kind of capital will be put into the asset, and at what level?”