Plans Announced for a Major Building on Gay Street

Conley Building, 505-507 Gay Street, Southwest Corner of Union and Gay, Knoxville, October 2017

Three weeks ago I wrote about the Conley Building at 505 – 507 South Gay Street. After a range of uses over the years, serving mostly as banks and office space, the building had become entangled in legal wrangling between two owners, resulting in a long-term under-utilization, including a prime corner at Union and Gay sitting empty for years.

The situation seemed deadlocked until the negotiation of a complex deal in which a new owner, Knoxville Hotel Partners, LLC, would take the entire building. The company behind the LLC is the Kana Hotel Group headed by CEO Alpesh Patel. I sat with Mr. Patel to discuss his background and the plans for the hotel.

Noting the deal to make the purchase was more complicated than any others he’s worked through, he said it was touch-and-go until the last moment as to whether the deal would come together. After nearly two years of negotiation, however, he says his company is now clear and in control of the property.

Conley Building, 505-507 Gay Street, Southwest Corner of Union and Gay, Knoxville, October 2017

His company researched the market looking for which flags were available for a downtown hotel, whether those flags would be feasible and whether it matched market needs. When he looked into the Conley Building and saw the mezzanine, he knew it would be perfect for an Embassy Suites.

Mr. Patel was born and raised in Knoxville, graduating from Carter High School. He attended Cornell University’s Hospitality/Hotel program. He worked for Ernst and Young as a hospitality consultant and lived in New York for two years. In 2003 he returned to Knoxville and, sold a couple of small properties owned by his father, and founded the Kana Hotel Group.

He built the company’s portfolio, “focused on taking care of guests and it grew.” He emphasized, “building great hotels and providing excellent services.” Noting that urban hotels are doing far better than others, he said he doesn’t consider himself visionary or he would have purchased property in downtown Knoxville ten years ago. He sees the downtown Embassy Suites as his company’s flagship hotel.

Making a serious commitment six months ago, he began work with design to see if the building, which has always contained offices, could be reconfigured to include sixteen suites per floor. The conclusion was that it worked perfectly. Previously focused on ground-up construction, this project represents the company’s first adaptive reuse.

Conley Building, 505-507 Gay Street, Southwest Corner of Union and Gay, Knoxville, October 2017

Conley Building, 505-507 Gay Street, Southwest Corner of Union and Gay, Knoxville, October 2017

Plans call for floors two through twelve to include 176 suites. The possibility of using the thirteenth floor for two 2400 square foot condominiums is being explored. Also planned is a rooftop bar and pool. The bar will be open to the public as an amenity to the city and will feature some of the best views in the city.

Of particular interest, is the ground floor. Coming on such a prominent corner, a hotel lobby utilizing the entire space would seem unfortunate. Mr. Patel agreed, saying he is invested in having a ground floor that engages downtown residents, visitors to the city and hotel guests. A portion of the ground floor will be a restaurant and he intends for it to be competitive with other restaurants in the city. He also intends to incorporate an additional business or two on the ground floor that would similarly attract all people in the city.

The challenge in the new building starts with a complete demolition of every wall and replacement of the entire wiring and plumbing systems. The work will begin in February of 2018 and will take about a year from beginning to end with a hoped-for opening in the spring of 2019. Whereas typical costs for a new hotel for his company run around $15 to $20 million, he anticipates this will be about  a $40 million project.

Regarding the number of hotels currently located downtown, under construction and planned, he feels this hotel will succeed based on location, amenities and brand. Acknowledging the number of rooms, he points out that his company is betting on Knoxville’s continued business and residential growth and feels the current growth in hotel space will be absorbed.

Conley Building, 505-507 Gay Street, Southwest Corner of Union and Gay, Knoxville, October 2017

He said he intends for the hotel to feel very boutique and local and that it will not a be a “cookie-cutter,” hotel. He plans, for example to include work by local artists throughout the hotel and he’s looking at other touches, such as a pink Tennessee marble and other touches. He said he is personally going through many details he would typically outsource because he sees this property as special to his group. It’s in his hometown and it’s personal.


ED NOTE: Don’t forget the CBID Sponsored Meeting – Brainstorming: Enhancing Downtown Living tonight at 17 Market Square from 5:30 to 8:00. Have your voice heard regarding the direction our downtown takes.


  1. Although a few folks will probably be disappointed that the “iconic” digital clock atop the building will not be restored, the rooftop bar and [heated?] [swimming?] pool open to the general public will be yet another unique addition to our still-evolving downtown. And although the Embassy Suites brand is sure to be a winner for extended-visit guests, if for some reason that use does not pan out, those suites could probably be easily repurposed as efficiency condos or apartments. I salute Mr. Patel not only for his diligence, patience, and tenacity in obtaining ownership of this very high-profile property, but also for his overall plans and intended hands-on supervision of the aesthetic details and amenities. As Barney Fife would surely say, “This is Big — REALLY BIG! !”

  2. Some Local Guy says

    176 suites with no attached parking? Good luck with that.

    • KnoxvilleUrbanGuy says

      According to Mr. Patel, “We currently are discussing leasing parking spaces from a nearby private garage and offering valet only services to our guests . . .”

  3. J. Randolph says

    Who is the architect for this project?

    • KnoxvilleUrbanGuy says

      PV Design (

    • I was wondering the same thing. When announcing these kinds of projects, disclosing the team that is making it happen is the right thing to do. I find it interesting that a Chatanooga firm was chosen even though “local” is promoted as a priority. I’m glad to see the project come together though. I’ve always liked that building. I do miss the clock.

  4. Keep us updated, please, UrbanGuy. Want to see drawings when available. This is big news in so many ways. Thanks.

  5. I wonder if we can expect a re-skin of the building. I’ve noted that the panels which divide the windows are looking terribly shabby. The windows, I know, will have to be replaced. Whenever it rains hard outside, it rains inside my office.

  6. This is great news.

    Does anyone know the status of the project across Krutch Park–the restaurant planned for the Holston building ? There was an initial flurry, but I’ve seen no outward progress lately.

    • KnoxvilleUrbanGuy says

      They should be back at work in the next few weeks, as I understand it. They changed contractors, I believe, which led to design changes, requiring more approvals, etc.

      • Excellent. I hope some of the new bustle of every-day activity from these projects spills out onto the green-space between them.

        The restaurant originally was going to have seating, windows, and doorways on their side of the park. Will the Conley building ground floor have any similar interaction with the park ?

        • KnoxvilleUrbanGuy says

          I wasn’t told anything about the Conley Building engaging the park. That might be more difficult for them, but I’m not sure.

          • Oren Yarbrough says

            I noticed something interesting the other day about the park that sits opposite Regal Cinema on Gay Street. The land use map on Knox GIS shows the land as currently used as a Public Park, but the Sector Plan Map and the One Year Plan Map show the park as intended “Mixed Use – Regional Center” development. Looks like the city isn’t intending for this to be a big open park forever. I could see a nice landscaped plaza space with a building set back on the site so the annual christmas tree and adjacent retail openings/patio aren’t negatively affected in the future. Just an interesting thing to point out.

  7. This sounds Great!
    Did he mention how he was going to find local art around here?

  8. Oren Yarbrough says

    It should be noted that this is a win win for Knoxville in one additional way. The Conley Tower being converted to a hotel & retail removes a large portion of very dated, but still operating, office space for downtown. I know it gets said often that downtown Knoxville doesn’t have a whole lot of demand for office space still, and because of that not a whole lot of development of Class A office space in the area. Maybe the redevelopment of the Conley Tower will create a small void in the local office market that will allow for a different developer to find it profitable and worth the effort to build a new office building downtown. I see this as a potentially good change for the city.

  9. Parking will be a key factor. With an ES on Parkside Drive, I would choose that hotel over going downtown and being inconvenienced with parking.

    • KnoxvilleUrbanGuy says

      That may be true for some people and affordability may also be a factor when people travel and decide to stay outside a downtown. For me, if I can figure a way to afford it, when I visit a city, I want to leave my car behind and know that I’m in the middle of things that interest and attract me when I walk out the doors of my hotel. I suspect there are others like you and others like me.

      • I agree with you, Alan. I especially HATE it when I travel with a group which includes in the itinerary an overnight stop in a particular city, only to learn that the stop is actually along the Interstate 15 or 20 miles distant from the downtown or city center — and without any transportation available to explore the area, visit any sites of note, eat in local restaurants, or otherwise get a feel for the community. It would be like visiting “Knoxville” and then spending the night at a motel near the Watt Road exit, with the only available shopping being a fireworks store, and the only restaurant being a Wendy’s or Denny’s.

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