Hotel Palomar set to open in crowded market

Cachet can carry you a long way in the boutique hotel business — or at least that’s what the owners of the trendy new Hotel Palomar in Midtown hope when they open the doors Wednesday.

The hotel is part of the San Francisco-based Kimpton hotel brand, and the property has the chain’s telltale style: unboxy, high-fashion rooms appointed in cranberry reds, chocolate browns and houndstooth, with rates that start around 200 bucks a night.

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Kent D. Johnson/kdjohnson@ajc.com

The Palomar was built by Beau King, son of legendary Atlanta builder Kim King.

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Kent D. Johnson/kdjohnson@ajc.com

Deven Barfuss of Premier Aquatics in Marietta works on a saltwater aquarium in the lobby of the Palomar.

• Photos: Midtown's Hotel Palomar

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“We’re a lifestyle hotel,” says general manager Mark Fischer of the 21-story, 304-room hotel on West Peachtree Street near 7th Street. “We’re above and beyond just boutique. Bringing the Kimpton name to Atlanta was huge.”

Fischer, showing a visitor around, points out the hotel’s 422-gallon visually “floating” aquarium in the lobby, waxes poetic about the inspiration for the carpeting in the meeting rooms, and proudly shows off the oversized bathrooms and Fuji soak tubs.

The hotel, built by Beau King, son of legendary Atlanta builder Kim King, will need as much style as it can muster to stand out in a city already brimming with pricey boutique hotels, a category that might be described as gourmet, versus big chains’ franchise feel.

The hospitality industry, like most segments, is in a deep recession that leaders expect will last through 2009 and probably into mid 2010. Occupancy levels have seen double-digit drops compared to a year before and room rates have nose-dived.

“It’s safe to say it’s a down market across the country, and it’s even worse in Atlanta,” said Scott Smith, an industry analyst with PKF Consulting, which predicts room occupancy rates in metro Atlanta will drop to 53.1 percent in 2009 from 59.3 percent last year.

It doesn’t help that when the Palomar was announced two years ago, the number of boutique hotels — including the newly opened Glenn downtown, the Hotel Indigo in Midtown, Twelve at Atlantic Station and the W in Perimeter — could be counted on one well-manicured hand.

That number has since doubled, including three more W’s, the Ellis (the renovated Winecoff downtown), another Twelve location just blocks from the Georgia Aquarium and World of Coca-Cola, and a handful of smaller properties.

But Fischer expresses the confidence of a hotelier whose doors will open Wednesday no matter how sunny or chilly the marketplace greets its latest pricey new upstart.

“The biggest thing for us is word of mouth,” he said. “The excitement of everyone coming into this building has been overwhelming.”