A pair of Naval Academy graduates have highflying dreams for the Annapolis hotel scene, a vision that earned them both friends and enemies in a town rich with tradition, but dependent on tourists.
Over the past three years, former helicopter pilots Cody Monroe and Clint Ramsden, who are both in their early 30s, have purchased five properties with the goal of boosting the city’s “luxury” accommodations.
“The city has been longing for a higher-end option for a long time now,” Monroe said. “We are looking to increase the number of offerings that Annapolis has on the high-end of the hotel spectrum.”
Their first hotel, 134 Prince, opened in January 2021 when many not-yet-vaccinated Americans were hesitant to travel. “It was the darkest hour of the pandemic,” Monroe said, and he wondered if he was crazy to set his introductory rate at $399. At the time, chain hotels were going for less than $100. And yet the guests came, eager to sleep in a Colonial-era building appointed with 24-concierage service and toiletries by French luxury goods brand.
Located at 134 Prince George St., the hotel offers rooms that now typically sell for $599 per night, and the owners say they have no problem booking all five suites. “The hotel is full,” Monroe said.
If all goes according to plan, the men, who both own homes in the Annapolis Historic District, will bring at least two-dozen similar high-end rooms to downtown Annapolis over the next three years. Their latest purchases include the former Coldwell Banker building on Church Circle, purchased for $2.8 million in July. Plans call for converting that 10,000 square-foot building into a small hotel with at least 13 rooms and two restaurants.
“I do think it’s exciting,” says Kristen Pironis, executive director of Visit Annapolis.
The prospect of more visitors with money thrills many involved with Anne Arundel County tourism, including the owners of some pricey restaurants.
But Monroe and Ramsden’s ambitions also pose quandaries for the city officials who codify and enforce hospitality industry regulations. Some residents worry that Annapolis can’t support so many high-end rooms. And no one is more skeptical than Ward 1 Alderwoman Elly Tierney, who compares what the young investors are doing in Annapolis to the demise of Potterville in “It’s a Wonderful Life.”
The “quality” of offerings Monroe and Ramsden are bringing to Annapolis “only benefits high spending visitors,” Tierney said. “And of course them.”
Early blades of real estate glory
The future real estate investors arrived in Annapolis to get their heads shaved just like all the other plebes do. Monroe hails from Boulder, Colorado and Ramsden from Fort Lauderdale, Florida.
Like many Naval Academy students, they grew to love Annapolis. Both emphasize their middle class backgrounds, even though their clientele now includes the wealthiest of midshipmen families. After graduating in 2011, they trained as naval aviators in Florida. Monroe stuck with the whirlybirds, while Ramsden veered off into public relations, eventually becoming an admiral’s aide at the Pentagon and earning a master’s degree in business from Johns Hopkins University. Monroe focuses more on construction and engineering details of their projects, while Ramsden guides much of the marketing.
They bought their first property in Jacksonville, Florida in 2013, and discovered there was money to be made by “flipping” long-term rental properties into short-term Airbnbs.
“We liked what we saw, and we started converting everything over,” Monroe told the podcast “Short-Term Rental Secrets” in 2020. Their first property earned approximately $32,000 per year as a long-term rental. But as a short-term rental? $109,000.
By they time they turned 30, the self-described “best friends and business partners” owned more than 20 properties. Investment money came mostly from friends stationed on aircraft carriers or deployed to remote areas. “You can’t really spend your money when you are on a ship or in the desert,” Monroe said. They knew former midshipmen who would complete a tour of duty with $50,000 in the bank.
Annapolis Capital Partners is what they christened the company, even though until they purchased 134 Prince George St., all their properties were in Florida. Both men left the Navy after 10 years of military service last summer. Suddenly instead of flying helicopters or writing speeches, their time was monopolized by maintaining short-term rentals. “It was grueling work,” Ramsden said. “I hated it.”
Making money off spring-breaker types was one thing, managing the properties was another. To sum up that experience, Ramsden slips into the vernacular of a millennial instead of a multimillion investor: “It sucks.”
“We said, ‘Sell it. Sell it all. Done.” Monroe said, of their big business move earlier this year. “Now we have an opportunity to reinvest this collection, from over a 10-year period, in the city of Annapolis.”
Bonjour Hermès, hello Charleston
Monroe says the proudest moment of his career thus far wasn’t earning his pilot’s license or a military promotion, it was getting 134 Prince approved to offer toiletries from Hermès.
“You get vetted,” he explained. “We had to submit drawings, design plans. We had to show the quality of the website. Every facet of the operation.”
“They were particularly interested in what our nightly rates were,” Ramsden interjected.
So who is paying $599 a night to stay in the Regatta Suite at 134 Prince and scrub down with French-milled soap in a marble-tiled shower? It’s not all VIPs visiting the Naval Academy, Monroe and Ramsden said. Turns out they book fewer Navy-related visitors than expected.
“We do a lot of weddings,” Monroe said. One weekend they hosted three brides in one night, none of whom were getting married at the Naval Academy chapel. Other high-profile guests have included household name CEOs, television network anchors and professional athletes. But many are not celebrities. The hoteliers describe their core market as people of means interested in a nearby luxurious getaway.
“Annapolis is a four-hour drive from 40 million people,” Ramsden pointed out, singling out Baltimore, New York, Philadelphia and Washington, D.C., as cities from which guests could easily drive. He and Monroe describe themselves as “hotel nerds” who have strong opinions on travel hot spots like New York’s Essex House and the Four Seasons opening this fall in Nashville.
Both have spent a lot of hours crunching numbers and comparing Annapolis to Charleston, South Carolina. Like Annapolis, the city has a military college, a major liberal arts school and historical landmarks to draw visitors. Even though Charleston is much farther from other metropolitan areas, the southern port manages to draw weekend-getaway tourists. The hotel and food scene is booming, with restaurant offerings from celebrity chefs that Annapolis lacks.
“Why does every New York City/Chicago chef have a satellite concept in Charleston and not Annapolis?” Ramsden asked. “We have a lot of advantages over Charleston.”
It’s worth noting that the Southern city has the advantage of Spoleto Festival USA, a 17-night infusion of opera, dance and classical music that attracts many discerning visitors with disposable income. There’s certainly no Spoleto equivalent in Annapolis. But Monroe and Ramsden believe that small business owners in Maryland’s capital “haven’t done enough” to attract wealthier tourists.
“The city is postured to do really, really great things,” Ramsden said. “Why not try a mixed use concept here with high-end hospitality options? Awesome restaurants that’ll invite a very discerning traveler.”
They envision up to three restaurants occupying the lower floors of 3 Church Circle. One will be a full-service restaurant pitched directly at the hotel guests. The other one or two more will cater to locals. Maybe a pizzeria. Or a bakery. Or a fast-casual option for a staple Ramsden says Annapolis is missing: “A really good to-go lunchtime salad.”
‘They are in a (permitting) conundrum’
Tierney, a former bed-and-breakfast owner who represents the Historic District on the City Council, could easily be one of those small business owner who Ramsden was criticizing. Now she’s one of the gatekeepers who has made it more difficult for entrepreneurs to run multiple hospitality empires in Annapolis. Under legislation passed in 2019 and strengthened earlier this year , no person or entity can hold more than one short-term rental license.
As of July, when Marsden and Monroe purchased the Flag House Inn on Randall Street, they own and operate two.
“They are in a conundrum,” Tierney said. “They are already violating the code.”
Monroe and Ramsden said they have applied to run Flag House as a bed-and-breakfast instead of under a short-term rental license. But City Code requires bed-and-breakfasts to be owner-occupied, and they would need to reduce the total number of rooms to five.
It’s not clear how Monroe and Ramsden will navigate those issues.
“The regulations are really strict,” Tierney said.
While the mixed use project on Church Circle won’t open for at least three years, two other properties that the pair is rehabbing will come online sooner. The quaint white Colonial-style building at 1313 West Street is across from the Michael E. Busch Library. Although previously a bed-and-breakfast, the new owners say it’s “too soon to tell” under which city hospitality license the building will reopen.
They do know that 86 State Circle, a 140-year-old office building now undergoing major renovations, will operate as an inn. They have a case pending before the city’s board of appeals for the property, since an inn is only allowed in that zoning district by special exception.
“Inns,” as defined by Annapolis City Code, have 25 rooms or less and no food service available to outside guests. With multiple restaurants on its lower floors, the Church Circle project would likely operate as a hotel, which is allowed in the property’s current zoning district.
But regardless of how Monroe and Ramsden end up sorting out the permitting conundrums, Tierney remains concerned about the investors’ plans to attract luxury tourists. The Airbnb phenomenon has already converted many former Annapolis entry-level apartments into short-term rentals. According to city data, there are 485 active short-term licenses on the books.
A year ago, there were 353.
Tierney says she knows Ward 1 will be never be the residential neighborhood it once was, but she wishes the city had more investors interested in making homes rather than making money off tourists.
“I don’t like the Historic District being turned into a Biltmore Village,” Tierney said, referencing the chic commercial district in Asheville, North Carolina.
‘The economy will decide.’
Monroe and Ramsden are quick to point out that none of the properties they’ve purchased in Annapolis were previously long-term rentals.
“We view Airbnb as the competition,” Ramsden said.
Fans of 134 Prince include Michelle Hoffman, a co-owner of Preserve with impressive New York and Washington restaurants on her chef’s resume. The Main Street restaurant she and her husband have run for eight years does not take reservations, but Hoffman said they have a “strategic partnership with their boutique hotels” and make an exception for Flag House and 134 Prince.
“We’ve gotten feedback that people are tipping well in excess of 100%,” Ramsden said, offering his guests’ generosity as evidence that wealthy tourists positively impact the local economy.
Marty Etzel, former owner of Flag House, said he and wife Carmel sold the property to Monroe and Ramsden because, “they have a good vision for what the experience should be.”
The Morning Sun
The couple never intended to be in the hospitality business long term, Etzel said. They bought Flag House in 2017 because they were seeking a fun second career as empty nesters. They discovered, however, that it took adding a sixth room and switching from a bed-and-breakfast to a short-term rental license to make the Flag House profitable.
Under the Etzels’ ownership, rooms typically maxed out at $429 a night for special events like the boat shows and Commissioning Week. On a random Tuesday, rooms could be $159. “There are only going to be so many people at a certain price point,” Etzel said.
As leader of the Annapolis tourism board, Pironis believes there are enough people to expand the city’s high-price-point market. She also thinks the young investors are smart to use Charleston as a comparison market.
“From a visitor perspective, a diversity of accommodations is a good thing,” she said.
The number of bed-and-breakfasts operating regularly in Annapolis is down to just two, according to city records, and it’s been 15 years since anyone opened a hotel. A new Marriott property was recently approved for Park Place, but otherwise, the city boasts only four hotels. There are seven inns, with another proposed at the building known as Ogle Hall. Fairwinds Capital Investments, the developers looking to convert the former Naval Academy Alumni Association office, are also academy graduates, but they have no affiliation with Annapolis Capital Partners, Ramsden said.
Pironis doesn’t agree entirely with Monroe and Ramsden’s assertion that before they came to town, Annapolis had no luxury accommodations. “That depends on your definition of luxury,” she said.
As for whether or not the city can support all the rooms they will eventually bring on board, she said “The economy will decide.”