Hospitality

Ashford Hospitality Trust Closes $427M Refinancing for 17-Property Hotel Portfolio

by Nellie Day November 1, 2017

DALLAS — Ashford Hospitality Trust (NYSE: AHT) has closed a $427 million refinancing of 17 properties within its hotel portfolio. The hotels in the portfolio are situated throughout the West, Midwest and South. The new loan is expected to result in annual interest savings of about $9.8 million. Properties included in the portfolio are — Courtyard Alpharetta, Georgia — Courtyard Bloomington, Indiana — Courtyard Crystal City, Virginia — Courtyard Foothill Ranch, California — Embassy Suites Austin, Texas — Embassy Suites Dallas, Texas — Embassy Suites Houston, Texas — Embassy Suites Las Vegas, Nevada — Embassy Suites Palm Beach, Florida — Hampton Inn Evansville, Indiana — Hilton Garden Inn Jacksonville, Florida — Hilton Nassau Bay, Texas — Hilton St. Petersburg, Florida — Residence Inn Evansville, Indiana — Residence Inn Falls Church, Virginia — Residence Inn San Diego, California and — Sheraton Indianapolis, Indiana The new mortgage loan has a two-year initial term and five, one-year extension options. The loan is interest-only features a floating interest rate of LIBOR plus 3 percent. The previous mortgage loan that was refinanced was the BAML 17 Pool loan with a final maturity date in December 2021. “The early execution of this refinancing provided us with …

November 1, 2017

Hospitality Market Reports Michigan Midwest Midwest Market Reports

Bedrock Is a Major Force in Motor City

by Kristin Harlow July 20, 2017

You’d be hard-pressed to find a commercial real estate company in the Midwest more active than Bedrock Detroit. The full-service firm — which acquires, leases, finances, develops and manages commercial and residential space — has several projects in the development pipeline spread across property types. Since its founding in 2011, Bedrock has located more than 160 office and retail tenants to Detroit’s “technology-centric” downtown. In addition, Bedrock and its affiliates have invested more than $3.5 billion in acquiring, renovating and developing slightly more than 100 properties totaling about 16 million square feet in downtown Detroit and Cleveland. Bedrock is commonly referred to as the real estate arm of billionaire businessman Dan Gilbert’s Rock Ventures. Gilbert is the chairman and founder of Rock Ventures and Quicken Loans Inc., the mortgage lending giant headquartered in Detroit. Diverse project portfolio In January, a joint venture between Shinola/Detroit LLC and Bedrock broke ground on the eight-story, 130-room Shinola Hotel. Located at 1400 Woodward Ave., the boutique hotel is scheduled to open in fall 2018. (Shinola, a Detroit-based company, is best known as a manufacturer of watches, bicycles and leather goods.) Chef Andrew Carmellini and Noho Hospitality are developing the food and beverage offerings to ensure …

July 20, 2017

Hospitality New York Northeast Top Stories

Pebblebrook Hotel Trust Sells Dumont NYC for $118M

by Nellie Day June 21, 2017

NEW YORK — Pebblebrook Hotel Trust (NYSE: PEB) has sold the 252-room Dumont NYC in New York for $118 million. The transaction marks Pebblebrook’s exit from the New York market. The upper upscale hotel is located at 150 E. 34th St. at Lexington Avenue in Manhattan. It was built in 1986. The buyer was LeFrak Organization, which plans to convert the hotel into apartments, according to The Real Deal. Dumont NYC was previously part of a six-hotel portfolio Pebblebrook held with joint venture partner Denihan Hospitality Group. Denihan Investments completed a redemption agreement with Pebblebrook that transferred ownership of the jointly owned hotels in October. Denihan became the sole owner of four of the assets. This included The Benjamin, Fifty NYC, Gardens NYC and Shelburne NYC for a total of 917 rooms. Pebblebrook assumed full ownership of Dumont NYC and Manhattan NYC, totaling 870 rooms. Manhattan NYC was then sold to a joint venture between Sioni Group, Patriarch Equities and Highgate for $217.5 million. It was rebranded as the Stewart Hotel. Proceeds from the Dumont NYC sale will be used for general business purposes, which may include reducing Pebblebrook’s outstanding debt or repurchasing some of the company’s common shares. “With …

June 21, 2017

Hospitality Illinois Market Reports Midwest Midwest Market Reports

Hotel Sector is on ‘Glidepath to Oversupply,’ But Chicago Could See a Soft Landing

by Kristin Harlow March 30, 2017

I am heartened to see that my projections for 2016 in the Midwest hotel marketplace — particularly Chicago, my home market — held up fairly well. In a column that I authored for Heartland Real Estate Business this time last year, I pointed out “the question of whether supply will outpace demand is changing from if to when in many of these markets.” That trend line has continued, although the momentum of it in some markets has, to some extent, delayed the inevitable. The demand side of the equation exceeded expectations in the fourth quarter of 2016 and so far in the first quarter of 2017. This has helped markets absorb the additional supply. I also wrote in last year’s column that “perhaps the single most important factor to watch with regard to the Chicago hotel market in 2016 is whether and to what extent strong leisure demand will continue to offset the influx of new hotel properties.” Sure enough, we saw strong leisure demand during the traditionally busy part of the year, and Chicago welcomed a record number of visitors during the first three quarters of 2016. Strong leisure and group segment performance during this period helped overall demand …

March 30, 2017

Hospitality North Carolina Southeast

MCR Completes Renovation of Hampton Inn by Hilton in Dunn, N.C.

by Taylor Williams March 22, 2017

DUNN, N.C. — MCR Development LLC, a hotel owner-operator, has completed renovation of the Hampton Inn by Hilton Dunn, a 120-room, select-service hotel located along the I-95 corridor in Dunn, approximately 40 miles south of Raleigh. The renovations included new landscaping, the addition of LED lighting to the exterior, a fresh painting and with new beds and furniture.

March 22, 2017

Hospitality Oklahoma Texas

MCR Completes Renovation of 102-Room Hotel in Tulsa

by Taylor Williams March 15, 2017

TULSA, OKLA. — MCR has finished exterior renovations of the Hampton Inn & Suites Tulsa-South Bixby, a 102-room, select-service hotel located at 8220 S. Regal Blvd. next to the Spirit Bank Event Center in Tulsa. The renovations included the additions of new fencing, signage and patio lounge furniture, as well as a fresh paint job.

March 15, 2017

Hospitality Texas

Embassy Suites, Hotel Capital Complete Renovation of San Antonio Hotel

by Taylor Williams March 13, 2017

SAN ANTONIO — Embassy Suites by Hilton and Hotel Capital have completed the 11-month, $7 million renovation of the Embassy Suites by Hilton San Antonio NW I-10, located at 7750 Briaridge Drive in San Antonio. The renovation was part of the Atrium Refresh Initiative, designed to update the art and architecture of the chain’s open-air lobbies. The renovation also included upgrades to the hotel’s bar and restaurant, as well as the interiors of each of its 216 suites.

March 13, 2017

Arizona Hospitality Top Stories Western

DiamondRock Acquires L’Auberge, Orchards Inn Resorts in Arizona for $97M

by Nellie Day March 1, 2017

SEDONA, ARIZ. — DiamondRock Hospitality Co. (NYSE: DRH) has purchased the 88-room L’Auberge de Sedona and the adjacent 70-room Orchards Inn Sedona for a total of $97 million. The resorts are situated in the Red Rock region of Sedona on the banks of Oak Creek, just south of Flagstaff. DiamondRock plans to reposition the resorts through a $5 million capital investment plan, which will enhance the luxury cottages at L’Auberge, among other improvements. The renovations will be completed during the off seasons over the next two years for minimal disruptions. “This acquisition represents a rare opportunity to own two high-quality resort properties in a coveted, high-barrier-to-entry resort market,” says Mark Brugger, DiamondRock’s president and CEO. “While we believe the initial pricing of the deal is attractive, we have identified significant opportunities to increase profitability.” About $14 million has been invested in the resorts, its guest rooms and restaurants since 2015. Sedona is one of the highest growth markets in the U.S. hospitality industry, DiamondRock notes, with RevPAR (revenue per available room) increasing 11.3 percent in 2016. L’Auberge includes dining options Cress on Oak Creek and Etch Kitchen & Bar, while Orchards Inn features 89Agave Mexican restaurant, among other casual dining …

March 1, 2017

Hospitality Market Reports Texas Texas Market Reports

San Antonio: Hospitality on the Rise

by Haisten Willis November 18, 2016

San Antonio evokes many positive images: the River Walk, the Alamo, Fiesta, the Mission Trail, Texas Hill Country and more. All of these images have one thing in common: hospitality. San Antonio is known for its warmth and hospitality. It is a fun place to visit for the many conventioneers and tourists that are attracted to the city year after year. It is also a good place to do business and a great place to live. Strength of the Market San Antonio boasts a strong economy. Overall employment grew at 3.5 percent over the past year, including an above-average growth of 3.2 percent for hospitality, retail and healthcare employment. Unemployment declined to 3.6 percent in July 2016, with strong increases in the labor force, according to Moody’s Analytics. Tourism and convention activity drive the economy, strengthened by a large military and cybersecurity presence. Manufacturing, healthcare and energy round out San Antonio’s strong, stable economy. The San Antonio lodging industry has also maintained a strong and steady pattern. While other Texas markets are adding a lot of new supply, San Antonio has kept the number of new hotel rooms to a minimum, adding only about 1,000 rooms over the past five …

November 18, 2016

Features Hospitality Texas Texas & Oklahoma Feature Archive Top Stories

Beware of RevPAR in Property Tax Valuations

by Haisten Willis November 3, 2016

When comparing hotels for valuation purposes, a common method of making adjustments for the difference between properties is to examine revenue per available room (RevPAR), a measurement of hotel performance. If executed poorly, these calculations can distort property value and lead to unfairly heavy tax burdens on hospitality owners. There are two different ways to calculate RevPAR. The first is to multiply the average rental income per room by the number of rooms occupied, then divide by the number of days in the period. The other method is to divide total guestroom revenue by the number of available rooms and divide that figure by the number of days in the period. In an article titled “Using RevPAR as a Basis for Adjusting Comparable Sales,” published in February 2002 by HospitalityNet.org, appraiser Erich Baum voiced a common argument shared by appraisers who advocate for RevPAR adjustments. Baum contends that the adjustments are appropriate because the revenue a hotel generates is tied to its location and the quality of its product. The question in valuation for property taxation is whether or not RevPAR incorporates additional, non-real estate values such as quality of brand, management, goodwill, etc., and whether or not the RevPAR …

November 3, 2016

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