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Calif. venture capital firm buys Downtown Knoxville hotel for $16.8M

The old Hyatt Regency opened in 1972 to much fanfare. It was one of the biggest and fanciest hotels in Knoxville.
Credit: WBIR
The former Hyatt Hotel on Hill Avenue, also formerly a Marriott Hotel, has been purchased by a Beverly Hills, Calif. billionaire.

KNOXVILLE, Tennessee — A venture capital firm co-founded by a Beverly Hills, Calif., billionaire has purchased one of downtown Knoxville's oldest and biggest hotels.

Real estate records show the former Hyatt Regency -- also a former Marriott -- at 501 E. Hill Ave. has been acquired by an entity called Melrose Knoxville LLC and businessman Neil Kadisha for $16.8 million in cash.

Credit: WBIR

Deed paperwork was filed Monday.

RELATED: Downtown hotel faces $1.9 million in liens

The hotel has changed hands several times in recent years. In March, BSPRT Knox Owner LLC of New York paid $8.3 million. Before that it was bought by an Arkansas hotel group for almost $22 million.

The distinctive pyramid-shaped hotel, near the Women's Basketball Hall of Fame, opened in 1972. It has a 12-story open lobby and more than 400 rooms.

Past owners also have had money problems.

Liens from 2018 and 2019 amounted to nearly $2 million when the property was known as Hotel Knoxville, records show. Unpaid bills included work for renovations.

Credit: WBIR
Lobby of the hotel at 501 E. Hill Ave. in Knoxville.

Among those that have been seeking payment are Contract Hardware Inc., $202,612; Ferguson Enterprises LLC, $31,182; Johnson Controls Fire Protection, $78,789; Merit Construction, $896,843; and United Elevator Service LLC, $213,620.

The firms started seeking payment in 2018.

Bloomberg lists Kadisha as CEO/managing partner of investment firm Omninet Capital LLC, which shares the same Beverly Hills address as Melrose Knoxville. Los Angeles media identify him as one of the area's wealthiest residents.

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