Peabody Hotel in Roanoke on hold until financing agreement is reached again

In light of existing market conditions and rising interest rates, officials from the Peabody Hotel development are considering financing options, according to Interim City Manager Cody Petree.

During Petree’s update to the City Council on Dec. 13, he mentioned construction on the project can not commence until the financing mechanism is finalized and in place. After an agreement was reached for financing in September, the Memphis-based hotel had until Jan. 1 to start construction. That deadline passed without any work.

“The Peabody and the city remain in constant contact and continue to look for the best options for both parties,” Petree said. “The City Council hopes to have more information in the coming months regarding the financing options before they can make any further decisions regarding the project.”

The project, which was initially supposed to have broken ground by April 1, 2020, was first announced in 2017 and approved by the City Council in May 2019, according to previous Community Impact reporting. In addition to market conditions and rising interest rates, another roadblock to the project's timeline has been the COVID-19 pandemic, according to previous reporting.

On Nov. 12, 2019, the council approved a resolution to issue up to $30 million in bonds to help fund the development of the Peabody Hotel and Convention Center. According to Community Impact reporting, the city would pay for the convention center, a portion of the parking garage and related infrastructure improvements, and the developer would fund the hotel portion of the project, which includes 266 rooms, a rooftop pool, two restaurants, two bars and a spa.

The project is estimated to cost a total of $144 million, according to previous reporting.

The Peabody Hotel is a landmark attraction in Memphis, according to the company website. Like the Tennessee location, the Roanoke Peabody Hotel will feature the Peabody Ducks—a flock that will grace the hotel lobby and fountain, according to council meeting documents.

“Our mission for Roanoke has long been focused on creating a unique and authentic sense of place, and we feel that bringing the Peabody brand to Roanoke will be the perfect fit,” Roanoke Mayor Scooter Gierisch said in a 2019 press release.