Plans for Kennesaw hotel on Old 41 Highway dropped for mixed-use development

Brick Kennesaw government building with four tall wooden columns

By Rebecca Gaunt

Plans for a 140-room hotel on Old 41 Highway, where the Electric Cowboy nightclub used to sit, were officially abandoned Monday.

The hotel was approved in 2018 as part of a 13-acre mixed-use development by Varner Developers on the former site of the Kennesaw Crossing Shopping Center. It was a highly desired component of the project since the only hotel inside city limits was destroyed by a fire earlier that year.

In September, Varner requested an amendment for the hotel component in order to replace it with mixed-use development on the 4.316 acres where the hotel was intended to sit. Plans include 208 luxury apartments, a minimum of 6,000 square feet of leasing and amenity space, a minimum of 12,000 square feet of ground floor commercial, a multi-level parking deck, pedestrian connectivity points along the adjacent property, and a multi-use trail.

Attorney Garvis Sams represented Varner at the meeting.

“There’s a good chance, if not a 100% chance, that Old Highway 41 is going to be…rerouted, and there’s not going to be any direct traffic movements from the airport to the site, nor vice versa. Plus the market for hotels…just simply isn’t there right now, unless we deigned to have the temerity to do an extended stay, and I wouldn’t wish that on any city or county,” Sams said.

Sams also responded to Councilman Pat Ferris’ question about why the offices haven’t been built in the four years since the development was approved.

According to Sams, an acre off Roberts Road has been listed since 2018 as zoned for office space, but the pandemic and the rise of working from home has negatively affected the real estate market for offices.

“We are going to build. We’re obligated to build it. We’ve got a site set up for it. We’re just not going to commit some sort of builder’s folly by doing it spec and not being able to [sell it],” he said.

As for the apartments, Sams said they’d be out of the reach of students due to price and because guarantors will not be permitted on leases.

Ferris expressed his frustration about what he called a “pattern of action by these developers” promising things and not following through.

“Frankly, I feel a lot of this partnership has been broken,” he said.

Councilman Antonio Jones said he had been looking forward to the hotel, which was approved before he was elected.

“I have a lot of family members that come in and out of town and we don’t have anywhere to put them,” he said.

Jones continued, “I think you really lost me when you said with the luxury, no one can afford those things–students, excuse me…with not having enough adequate affordable housing as well. I just don’t see where it’s a win.”

Sams responded, “First of all, Mr. Ferris, we did everything that we were obligated to do under the original incentive agreement…you may think it’s going to be eight or 10 years, but the FAA told me it’s going to be more like four or five years when they actually close Old 41 and it will be a circuitous way to get to the city. And that may suit you all, but it doesn’t support a hotel.”

Jon Fred Bothers and David Blinkhorn, both candidates in the recent City Council Post 1 special election, spoke during public comment.

Blinkhorn suggested the Council negotiate changes before approving the request and consider needed medical facilities.

“They haven’t presented anything that says ‘our studies show that Kennesaw needs more high-end apartments,’” he said.

Blinkhorn continued, “I love the fact they keep bringing up the airport. That project has been on Cobb County’s desk for over 10 years–before they even thought of this project. So for them to stand there and say nobody wants to build there because the airport might change when they knew that when they started this.”

Bothers took issue with the exclusion of college students.

“There is not enough student housing right here in the Kennesaw area already. You cannot run away from Kennesaw State University. It’s going to continue to grow,” he said. “It’s ridiculous that you raise the prices so high that not only can the students [not] afford them, but regular families can’t afford them.”

Darryl Simmons, the planning and zoning administrator who recommended approval of the amendment to the original plan, was visibly frustrated by some of the comments.

“I’m speaking on behalf of staff and the hard work that we have done over the past six years,” he said. “All of the analysis and all of the work that we’ve done has been collaborative. What I’m simply saying is we’re not taking the word of any applicant that comes to our office…our economic development team, planning and zoning, our community development staff–we do our homework as well.”

Simmons indicated the city’s student housing ordinance, passed in 2020, which he authored, as an example of how the city is promoting welcoming students to the city.

Sam Olens, the former attorney general and former president of Kennesaw State University, attended the meeting on behalf of his client FedEx.

A FedEx distribution center borders on the development. Olens said the center generates 4,000 truck trips a month.

“Around the country, they keep being sued for nuisances even though they were there first. So as you can imagine, they want to have further protection,” Olens said.

Olens and Sams reached an agreement prior to the meeting for the developer to put in trees as a buffer. Additionally, all owners and leaseholders must be notified in advance that the facility was there first to discourage lawsuits.

The amendment was approved 3-2, with Ferris and Jones in opposition. Mayor Derek Easterling broke the tie, by voting in support with Tracey Viars and Trey Sinclair.

Background on the development

In 2019, Varner requested $800,000 in incentives, but was granted $385,000 in tax abatements.

Then-Councilman Blinkhorn was the lone nay vote. Attorney Sams told the Council at the time that the stipulation to demolish the shopping center within two years created a hardship because Electric Cowboy had 5-7 years left on its lease and had to be bought out.

Blinkhorn pushed back on the request, asking why the city was being asked to foot the bill.

Then-Councilman James “Doc” Eaton voted in favor of the incentives, but expressed concern that the city had been “burned before.”

“…the hotel has got to be a reality, the retail has got to be a reality, the condos for the offices have got to be a reality,” Eaton said.

In February 2022, the developers proposed substituting a storage facility in place of the hotel saying the market no longer supported building one.

“Looks to me like we got laid over the barrel again so to speak. $385,000 for abatements and we’re still not going to get our hotel,” Eaton said.

Easterling and Simmons, as well as the rest of the Council, made it clear they were not pleased with the storage unit proposal.

Simmons noted that the Town Center Community Improvement District and Cobb County had been part of the discussions about a hotel in that location because both border on the property.

“We all said some type of tourism component would be appropriate,” Simmons said.

The storage facility was never formally proposed after the cold reception.

Varner has agreed not to seek any additional incentives from the city.

View the discussion in full on the City of Kennesaw Facebook page.

Rebecca Gaunt earned a degree in journalism from the University of Georgia and a master’s degree in education from Oglethorpe University. After teaching elementary school for several years, she returned to writing. She lives in Marietta with her husband, son, two cats, and a dog. In her spare time, she loves to read, binge Netflix and travel.