Atlanta mayor: InterContinental hotel at Hartsfield-Jackson will diversify revenue

An InterContinental hotel to be built on the Hartsfield-Jackson International Airport campus is expected to be completed in 24 to 30 months, said Atlanta Mayor Kasim Reed.

The hotel will be just steps away from the domestic terminal, and will be the only hotel within walking distance of the world's busiest airport.

At Hartsfield-Jackson, "the InterContinental hotel will probably be one of the best flagship hotels that any airport has in the United States of America," said Atlanta Mayor Kasim Reed.

Sources say the project architect is expected to be John Portman & Associates. InterContinental has its Americas headquarters in metro Atlanta, and Portman is an Atlanta architect well-known for his design of atrium-style hotels in the United States and in Asia. In downtown Atlanta, he designed the Hyatt Regency Atlanta, Westin Peachtree Plaza and the Atlanta Marriott Marquis, as well as the Peachtree Center complex.

The hotel is expected to be built by a team including Atlanta-based developer Carter, Majestic Realty Co. and GPM Investments LLC as part of an "Airport City" project. The airport plans to lease out 26.5 acres of land, including 10 acres for a hotel just outside the exit on the west end of the domestic terminal, 3.5 acres for a travel plaza and 13 acres for office space and mixed-use development.

Reed said a key motivation for building the hotel is to diversify the airport's revenue, to prepare for a shift in the dynamics of airport parking.

Parking makes up about a quarter of the airport's revenue, but in the future that could shift with the growth of options like Uber, Lyft and eventually even self-driving vehicles, Reed said.

"I don't believe, candidly, in 10 years, or 12 years, or even faster, that most folks are going to drive to the airport," Reed said. "Our sense is that airports' revenue streams are going to have to change for the future."

Office buildings, hotels, restaurants and retail are ways to bring in more revenue rather than relying on parking spaces, he said.

"That's really what the InterContinental play is all about," Reed said. "It's about what you can do to derive other sources of income to make up for a future that we don't believe is going to be so dependent on parking."

The airport has considered the hotel idea for about two years and is expected to seek city council approval for the deal.

Meanwhile, the airport is preparing to boost spending on expansion projects for a five-year period, spending as much as $800 million in a single year, as part of a $6 billion master plan.

With the airport in the final stages of negotiations with Atlanta-based Delta Air Lines for a 20-year lease, "We're all trying to figure out how we're going to handle that spike" in spending, Reed said. "You're going to be pushing out a lot of projects over at the airport. That's what they're trying to work through."

Plans are for the lease terms to allow "real opportunity for expansion for other airlines at Hartsfield-Jackson," Reed said. But with Delta Air Lines as the dominant hub carrier at the airport, "the strategy that we are sticking to is to dance with the one that kind of brought us," he said.

About the Author

Kelly Yamanouchi
Kelly Yamanouchi
Business reporter Kelly Yamanouchi covers airlines and the airport.