Hotel Cleo ready to open doors to the 'Old World' with luxury 'pampering' on Gay Street

Ryan Wilusz, Knoxville News Sentinel

Tue, Dec 26, 2023, 3:08 AM 5 min read

Though Hotel Cleo will become downtown Knoxville's newest hotel when it opens on Gay Street later this month, the boutique product is filled with classic luxurious amenities from European years past, including canopy beds and a detailed concierge service that will provide equally luxurious recommendations to its "pampered" guests.

Considering this blend of new and old, it's only fitting the project is a collaboration between one of downtown's most notable up-and-coming developers and one of Knoxville's most established real estate investors.

Knox News first reported on the project in October 2021 after speaking with HD Patel, whose Ephant Group is co-developing and managing the property. At the time, Patel was just beginning to expand from specializing in "cookie-cutting" hotels to building boutique projects.

Since then, Ephant Group has acquired some of downtown's most notable properties, including Vine Furniture on West Summit Hill Drive and an Old City parking lot at the corner of South Central Street and Willow Avenue near the forthcoming Smokies stadium.

Patel told Knox News that COVID-19 changed his mindset about the trajectory of his professional life, though people thought he was crazy to plan such a high-level project as Hotel Cleo during such a difficult time for the hospitality industry.

Finding experienced partners made the challenge less daunting.

Hotel Cleo finds the right partners in Knoxville and beyond

With Hotel Cleo, Patel is collaborating with Oliver A. Smith IV of Oliver Smith Realty & Development Company, who told Knox News this development is being considered a legacy project for the development team.

"This is something that we want to be here a long, long, long time," Smith said. "We all said, if we do this right, this is a gift to Knoxville and the people of Knoxville. And we believe that heavily."

Jim Turner also is a partner in the Hotel Cleo, which is connected to Lilou, a new French restaurant and bar that will serve the public and hotel guests. Lilou is owned by Aaron Thompson and Jessica King, who formerly owned and operated Sapphire in the same building at 428 S. Gay St.

The couple also are behind Brother Wolf in the Old City, which was named by Esquire magazine as one of the country's best bars and is attached to their Italian restaurant, Osteria Stella.

With Lilou, the couple are taking an approach similar to their Italian concepts. Just as they recruited a Milanese chef to Osteria Stella for authenticity, Lilou chef Benjamin Tilatti was born and raised in southwest France and will be serving a menu that includes frog legs, monkfish, sweetbread and duck.

The hotel lobby also will serve as a cocktail lounge for Lilou.

Both Lilou and Hotel Cleo were conceived with help from Streetsense, a highly regarded global brand builder with "creative hubs" in London, Los Angeles, Madrid, New York City and Washington, D.C.

Emphasizing quality over quantity of rooms at Hotel Cleo

"Let's not compromise." This has become the theme for everyone involved in the project, according to Smith and Patel.

Across its 16 rooms − four on each of the above-ground floors − guests will notice a "European, Old World feel," Smith said. No room is designed the same, but each one contains a unique collection of antiques and carefully curated paintings.

"Doing a normal hotel is a huge commitment," Smith said. "But something like this, the time commitment to do this is unbelievable. ... There's no formula."

Only one bedroom in Hotel Cleo includes a bathtub, as each guest suite is designed differently. While the result is a unique boutique product, the development process is more challenging than building branded chain hotels because "there's no formula," co-developer Oliver A. Smith IV told Knox News.

Sixteen rooms, each roughly 500 square feet, might not sound like a lot. But in March, Visit Knoxville President Kim Bumpas told Knox News variety can be just as important as the quantity of rooms in a market.

"We don't want all (downtown hotels) to be limited service," Bumpas said. "You want to figure out what that product mix is."

While hotels with 20-or-so rooms aren't "game changers" in terms of quantity, she said, "it is a product that will drive rates."

'Pampering service' and shared space for Gay Street hotel guests

On each floor, four rooms share a common "salon" where breakfast will be delivered each morning and where guests can mingle on lounge furniture.

Along with the unique floor plans (including one with a bathtub in the bedroom), these common areas serve to make the experience feel more like sharing a downtown loft than a hotel.

In addition to offering accommodations for wedding parties and romantic getaways, Smith said, Hotel Cleo should also serve business travelers.

"We have so many international companies and national companies now here, some of these executives are going to come in and they're going to say ... 'Where do I stay?'" Smith said. "You have a property like that, because it's so unusual ... they'll want to try it."

Hotel Cleo features 16 rooms, four on each of its above-ground floors. Each floor has a private "salon" in the middle, pictured here, which allows friends, family and strangers to all socialize over drinks or breakfast delivered from Lilou each morning.

A smaller number of rooms also allows Hotel Cleo to offer a robust concierge service − "more of a European experience," Smith said. That means staff will be trained with recommendations for anything a guest might need, from spa services to drivers.

While staff members will direct guests to Lilou, they also will have other restaurant recommendations, down to preferred menu items. Smith calls it a "pampering service."

Hotel Cleo opening soon in downtown Knoxville

When Knox News first reported on the hotel and restaurant project, the cost estimate was $9 million.

While the partners did not share an updated cost, Smith said the project is "a heavy investment for downtown" as the cost for acquiring materials and décor has gone "up and up and up and up."