CGI Merchant Group to Convert Morris Brown College Facility Into Upscale Hotel

CGI Merchant Group has made a $30 million investment in a ground-up development project to convert the existing facilities at the historic Morris Brown College in Atlanta into an upscale hotel. CGI made the investment through its $650 million hospitality opportunity fund, which plans to invest in 20 total hotel projects in North America and the Caribbean over the next three years.

The construction project will redevelop existing facilities on the campus into a 90,000-square-foot, 150-room upscale hotel along with a hospitality training complex. The property will include two food and beverage outlets, an outdoor terrace and instructional space for the school’s hospitality students. With this development, Morris Brown College will become the first Historically Black College and University with a flagged hotel on campus.

Tapestry Collection by Hilton will operate the hotel, but the Hilton brand plans to take a uniquely active role in the project. It is serving in an advisory capacity for the colleges’ hospitality management program, which will include helping to develop the curriculum and providing ongoing support with guest speakers and job shadowing.

CGI is similarly taking a more active role in this investment. In addition to funding the hotel development, the firm will launch an endowment to provide financial aid to students, fund future expansion goals and support minority and women-owned businesses in the surrounding community. These initiatives will help ensure the hospitality management program is among the leading programs in the US.

The investment is part of CGI’s ongoing goal to support local and minority-owned businesses. As such, the firm has engaged Atlanta-based C. D. Moody Construction and Chasm Architecture for the project.

This may seem like an odd time to launch a hotel project, considering the pandemic has halted the travel industry and all related activity; however, most are forecasting a full recovery—but it might take a few years. In a commentary piece published by Preqin, John McCourt and Ryan McAndrew of RSM US LLP predict that deal flow won’t return until 2022, and when it does return, it will likely come in fits and starts depending on the asset type, its location and the financial status of the owner.

Not all assets will recover at the same pace, either. Drive-to destinations, like the Florida Panhandle, the Gulf Coast and Mid-Atlantic markets, extended stays and limited service hotels and hotels near college campuses are performing better than urban or suburban group convention-focused hotels.