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 James Funderburk Developing First Boutique Hotel
In Charlotte; To Be Named Hautel - a French
Reference to High Fashion -- Pronounced "Hotel"
The Charlotte Observer, N.C., Doug Smith Column
By Doug Smith, The Charlotte Observer, N.C.
Knight Ridder/Tribune Business News 

Jan. 25, 2004 - Trend-setting entrepreneur James Funderburk wants to open the first "boutique" hotel in Charlotte by late this year. 

His company is working to acquire the 42-year-old Center City Inn at 319 W. Trade St. and invest $7 million to $8 million in restoring it as the ultra-chic Hautel. 

Boutique hotels, typically 150 rooms or less, focus on amenities, style and service to create a more personal experience for guests, generally mid- to upper-income travelers in their early 20s to mid-50s. 

Funderburk envisions the 101-room Hautel, for example, as a place where out-of-towners get a sense of the city by mingling with local patrons at the fine dining restaurant, enjoying conversation at the bar, reading in a quiet nook or browsing artwork displayed in the lobby. 

Developer Jay Blanton of Insite Properties, who is teaming with Funderburk in Funderburk Hotel Group LLC, said, "There will be a high degree of concierge services -- we will have people on staff who will do anything for anybody." 

Boutique hotels -- the trend dates to the early 1980s -- gained popularity as an alternative to national chains as "hip" travelers searched for unique experiences. 

Most feature individualized decor, and some offer a variety of themes -- from music to romance -- in each guest room. 

Typically, boutique hotels charge more than national chains. 

Funderburk hasn't set rates, but he anticipates most rooms will be priced from $145 to $195 a night. That would be in line with the uptown market. Marriott Center City, for example, quotes rates ranging from $89 to $180 a night. 

Funderburk has worked on the concept -- also known as a design hotel -- two years. The name Hautel comes from haute couture -- a French reference to high fashion -- and is pronounced "hotel." 

He's announcing the project as the Charlotte metro area lodging market -- about 30,000 rooms -- is just beginning to show signs of recovery from overbuilding and a three-year occupancy slump. 

And, Funderburk acknowledges, people have asked him why the city needs yet another hotel. "I tell them this is an unserved, niche market in Charlotte with no competition," he said. 

Mohammad Jenatian, president of the Greater Charlotte Hospitality & Tourism Alliance, believes Funderburk is on to something. 

"Anything unique today, it sells -- in Charlotte and everywhere in the country," he said. "And those people who are creating a niche for their businesses are doing better than they have in the past." 

Funderburk is perhaps best known in Charlotte for his trend-setting in fashion and nightlife. 

Urban Evolution, an upscale clothing store he opened 10 years ago, introduced Charlotteans to $200 jeans; and Tonic, a nightclub he started as principal owner 4 1/2 years ago, focuses on cool furnishings, unique lighting and fire pits on the deck. 

Hautel could become similarly trendy, he said, making uptown Charlotte more of a destination and helping fill a gap between The Square and Gateway Village on West Trade Street. 

Tim Newman, president of Charlotte Center City Partners, said, "We think a boutique hotel on Trade Street with the proximity to The Square would be a great addition to the hospitality and entertainment scene." 

Johnson & Wales University, which plans to open a campus this fall at Gateway Village, has expressed interest in the project and sees potential for its culinary and hospitality management students to become involved there. 

"We are encouraged by what they are doing, and we are hopeful that they will be successful," said Art Gallagher, Charlotte campus president. But, he said, no formal agreement has been reached. 

Blanton said he has discussed the project extensively with Tom Dwyer, Johnson & Wales' chief financial officer. 

"In ongoing conversations," Blanton said, "the university has expressed a willingness to be one of our investors pending approval of the final pro forma." 

In addition, he said, Johnson & Wales officials have indicated they would be willing to help the developers find an operator for the hotel. 

Karina Erdelyi and Wilson Kello of New York City-based SAME, a design collective, will be the design consultants for the project, as well as investors in it. 

Attracting additional investors will be key to completing the purchase of the Center City Inn and renovating the five-story structure, Blanton said. 

He said Alex Brown and Al Butts of Charlotte Uptown Hotel LLC are the current owners. 

The goal, Blanton said, is to acquire the building by May, start construction in June and open Hautel before the end of the year. 

The developers have begun working with lenders to finance the renovation, he said. 

Blanton said the Charlotte office of Gensler, an architectural firm, designed the makeover, which will convert parking spaces under the building to lobby and restaurant space, create a rooftop deck, add an outdoor dining patio and replace concrete with glass blocks in many walls. 

He said Charlotte's Edifice will be the general contractor. 

Boutique hotels have emerged in major cities worldwide, and Funderburk is convinced his timing is right in the center city. 

"This will be my most ambitious project to date," he said. 

Doug Smith: (704) 358-5174; 

-----To see more of The Charlotte Observer, or to subscribe to the newspaper, go to 

(c) 2004, The Charlotte Observer, N.C. Distributed by Knight Ridder/Tribune Business News. MAR, 


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