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« August 2011 | | October 2011 »
Posted On: September 27, 2011 by the JMBM Global Hospitality Group®

Hotel Industry Alert: Some things to feel (very) good about!

For the most recent update on this topic, click here

By Jim Butler and the Global Hospitality Group®
Hotel Lawyers | Authors of www.HotelLawBlog.com
27 September 2011

Hotel Lawyers with some (very) good news.

Of course there are plenty of macro economic issues and industry challenges to worry about. (See It's not just me. The market has changed.)

But there are also some things to feel good about. If you want to be gloomy, go read your newspaper. If you want to cheer up, keep reading.

Here are a few nuggets of information to brighten your day.

[The slides in this article are taken from presentations at The Lodging Conference in Phoenix by Mark Woodworth of PKF, and Vail Brown of Smith Travel research. We appreciate their permission to use their slides.]


Continue reading " Hotel Industry Alert: Some things to feel (very) good about! " »

Posted In: Outlook and Trends

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Posted On: September 25, 2011 by the JMBM Global Hospitality Group®

Hotel Lawyers in Phoenix: "It's not just me. The market has changed in just the last 60 days!"

For the most recent update on this topic, click here

By Jim Butler and the Global Hospitality Group®
Hotel Lawyers | Authors of www.HotelLawBlog.com
25 September 2011

Hotel lawyers: Are we at a turning point in the industry?

Our hotel lawyers were at The Lodging Conference in Phoenix last week, taking the measure of the hotel industry. It was pretty interesting. Some said August was a "turning point" and they were not referring to a good thing.

At the Hotel Law Blog, what happens in Phoenix does not stay in Phoenix. Here's what we heard.

"It's not just me. The market has changed in just the last 60 days!"

While many people at the Lodging Conference said recent market volatility had no impact on them, their transactions or their deals, this was clearly not the case for all.

A widely-held view was that it seems like someone hit the "PAUSE" button on hotel finance and purchase-sale transactions. Some fear a "reset" button may also have been tripped. The global market turmoil of the past 30-60 days triggered by the inability of our politicians to resolve deep U.S. budget issues, along with questions about political resolve by European governments to deal with their own problems continue to raise major issues.

And there are all the usual specters of big increases in taxes, continued high unemployment, sagging consumer confidence, rising labor costs, rampant inflation to deal with $14 trillion of debt, operating costs rising faster than RevPAR as well as war, plague and pestilence.

So here are some insights from industry leaders and vignettes JMBM's hotel lawyers gathered at the Phoenix Lodging Conference. In many cases we have omitted the speaker's names because I was not certain that the comments were intended for attribution.

Continue reading " Hotel Lawyers in Phoenix: "It's not just me. The market has changed in just the last 60 days!" " »

Posted In: Outlook and Trends

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Posted On: September 20, 2011 by the JMBM Global Hospitality Group®

Hospitality Lawyers in Phoenix for the 2011 Lodging Conference. What's happening to the hospitality industry?

By Jim Butler and the Global Hospitality Group®
Hotel Lawyers | Authors of www.HotelLawBlog.com
20 September 2011

Hotel Lawyer at the Phoenix Lodging Conference: Where are we going from here?

The Lodging Conference kicks off tonight at the Arizona Biltmore as roughly 1,500 hotel industry leaders gather for the next 3 days. This is one of my favorite hotel finance conferences of the year, and JMBM's Global Hospitality Group® will be well represented. Senior GHG members Guy Maisnik, Cathy Holmes, Bob Braun, David Sudeck and I will all be here.

Aside from the great connections and catching up, the one thing everyone at this conference will be looking for is some sense on what happens to the hospitality industry from here. The first part of the year was robust transactionally speaking, with lots of hotels changing hands and pretty good financing for established hotels with good cash flow. But it seems like everyone got spooked a little in late August about the time Congress was deadlocked on a budget. Then the U.S. credit rating was downgraded, and the European debt crisis has continued to foment trouble, initially focused on Greece, but now more on Italy with its credit rating decrease, with concerned looks toward Spain and elsewhere.

On the one hand, one can argue that all this should have no affect on the hotel industry, at least in the United States. But the markets are unsettled and everyone seems to be taking a second look before they continue with business as it was earlier this year. And of course, the lodging industry has a long-term direct correlation with the economy. So, if the increasing pessimism pointing to an impending recession wins the day, we are all in for a bumpy ride.

I will be very interested to measure the mood of The Lodging Conference this year, and see how everyone else is viewing the current situation. Do we catch our breath and continue from roughly where we were, or do we hold our breath and get ready for a roller coaster ride? I may have some more insights for you shortly.

Continue reading " Hospitality Lawyers in Phoenix for the 2011 Lodging Conference. What's happening to the hospitality industry? " »

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Posted On: September 20, 2011 by the JMBM Global Hospitality Group®

Hotel Labor and Employment Lawyer Update: Controversial Union Rights Notice Subject to Legal Challenge -- Employers Should Not Rush To Post It

For the most recent update on this topic, click here

By Jim Butler and the Global Hospitality Group®
Hotel Lawyers | Authors of www.HotelLawBlog.com
20 September 2011


On September 10 2011 , we let you know that the National Labor Relations Board (NLRB) is making it harder to stay union free.

As of November 14, 2011, most private sector employers are required, by a controversial new National Labor Relations Board rule, to post a notice advising employees of their rights under the National Labor Relations Act.

Now, according to my partner, labor and employment lawyer Scott Brink, the NLRB's authority to issue the new rule is already the subject of legal challenge.

Because NLRB enforcement of the new rule may be delayed -- pending the resolution of a lawsuit challenging the validity of the rule -- employers should not rush to post the notice before the November 14, 2011 deadline.

Scott's brief article below explains what is going on and why you need to pay attention to this important development.

A link to the NLRB's Form of Notice, which was issued September 14, 2011, may be found at the end of the article.

Continue reading " Hotel Labor and Employment Lawyer Update: Controversial Union Rights Notice Subject to Legal Challenge -- Employers Should Not Rush To Post It " »

Posted In: Labor & Employment

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Posted On: September 12, 2011 by the JMBM Global Hospitality Group®

Hotel Franchise Lawyer: Hotel Franchise Agreements and the 5 biggest mistakes a hotel owner can make

For the most recent update on this topic, click here

By Jim Butler and the Global Hospitality Group®
Hotel Lawyers | Authors of www.HotelLawBlog.com
12 September 2011

Hotel Lawyer with some tips on Hotel Franchise Agreements and the 5 biggest mistakes a hotel owner can make

Hotels need brands, and brands need hotels. For many years, hotel brands have been growing in importance for the success of hotels in the United States and abroad. The trend toward branding is quite a phenomenon. According to numbers we have seen, In the early 1990s, approximately 40% of the hotels in the U.S. were branded and the balance were independent. Now the number is probably closer to 80% or more of the hotels are branded or brand-affiliated.

The branding is often accomplished by a franchise or license agreement from a company owning the brand. Other times it is accomplished by a branded hotel management company entering into a management agreement with the owner of the hotel, providing both the brand and management for the property.

Although we have spent a lot of time on Hotel Law Blog discussing hotel management agreements, today we are going to focus on the franchise or license agreement arrangements. With more than 20 years' experience working with more than 1,000 hotel management and franchise agreements, we have some perspectives that may be worth considering.

Hotel owners keep falling into the same traps

One of these perspectives of our hotel lawyers is that many sophisticated hotel investors and owners seem to fall into a handful of traps that would be easy to avoid. And this same handful of traps catches the unwary time and again.

So this article focuses on hotel franchise agreements and outlines the 5 biggest mistakes an owner can make when seeking a hotel franchise arrangement. If this sounds all too familiar, you have probably learned these lessons the hard (and expensive) way. If you haven't stumbled on these yet, you won't want to miss the warning flags and the traps they portend.

Continue reading " Hotel Franchise Lawyer: Hotel Franchise Agreements and the 5 biggest mistakes a hotel owner can make " »

Posted In: Hotel Management Agreements

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Posted On: September 10, 2011 by the JMBM Global Hospitality Group®

Hotel Labor and Employment Lawyer Alert: The NLRB is making it harder to stay union free.

For the most recent update on this topic, click here

By Jim Butler and the Global Hospitality Group®
Hotel Lawyers | Authors of www.HotelLawBlog.com
10 September 2011

A highly controversial new law, which many employers believe will unfairly foster union organizing, requires that employers post notices of employee rights -- including the right to organize, join or discuss the activities of a union. The law goes into effect on November 14, 2011.

Employers must comply with the new rule whether they have a unionized work force or not.

My partner, labor and employment lawyer Scott Brink, has outlined in his article below the requirements the new rule imposes on employers.

Scott and the labor and employment lawyers of JMBM's Global Hospitality Group® have represented the hospitality industry in all aspects of labor and employment law including union prevention, collective bargaining negotiations, and defense of unfair labor practice charges before the NLRB. If you have questions about how this new rule will impact your hotel business, we can help.

Continue reading " Hotel Labor and Employment Lawyer Alert: The NLRB is making it harder to stay union free. " »

Posted In: Labor & Employment

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Posted On: September 8, 2011 by the JMBM Global Hospitality Group®

Tips from hotel franchise and management lawyers: Beware the trap of "changing brand standards"

For the most recent update on this topic, click here

By Jim Butler and the Global Hospitality Group®
Hotel Lawyers | Authors of www.HotelLawBlog.com
8 September 2011

Hotel Lawyer on changing brand standards.

Hotels need brands, and brands need hotels.

Like all relationships, the relationship between branded hotel operators or franchise companies (the brand) and hotel owners needs ground rules. As long as both parties agree to the rules and follow them, who can complain?

Now, what happens if the ground rules change? In most relationships, both parties would agree to change the rules -- or they would separate and go their own ways.

And what if one of the ground rules is that only one party can change the rules at any time? And the other party would have to follow them, no matter what? This is what can happen to hotel owners that agree, often for very good reasons, that a brand can change its standards for the hotel.

Sometimes the change in brand standards is not so good for the owner... one day you're turning a profit and the next day you're in the hole, paying for expensive changes required by the "new brand standards," with no return on investment in sight.

The management or franchise agreement sets the ground rules and allocates risk between the hotel operator and the hotel owner. Negotiating the agreement, which will include "brand standards", is one of the most important things hotel owners will ever do for their hotel investment.

Here is some advice from my partner, Robert Braun, co-author with me of the HMA Handbook.

Continue reading " Tips from hotel franchise and management lawyers: Beware the trap of "changing brand standards" " »

Posted In: Hotel Management Agreements

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« August 2011 | | October 2011 »

About the Authors

Jim Butler

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Jim Butler is recognized as one of the top hotel lawyers in the world. He devotes 100% of his practice to hospitality, representing hotel owners, developers and lenders. Jim leads the Global Hospitality Group®—a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe.
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Robert Braun

Robert Braun is a partner in JMBM's Corporate Department and a senior member of JMBM's Global Hospitality Group® -- a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe. Bob represents owners in both transactional and operational issues. He advises clients with respect to business formation, financing, mergers and acquisitions, venture capital financing, joint ventures and strategic partnerships. He has represented hotel owners in the negotiation of several hundred management agreements, as well as spa management and franchise agreements. Bob also advises hotel owners regarding telecommunications, software, internet, e-commerce, data processing and outsourcing agreements. To read Bob's articles, go to www.HotelLawBlog.com and select "Management Agreements." For more information, please contact Bob Braun at 310.785.5331 or rbraun@jmbm.com.

Marta Fernandez

Marta Fernandez is a partner in JMBM's Employment and Labor Department and a senior member of JMBM’s Global Hospitality Group® -- a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe. As a management labor lawyer with more than 20 years of experience, Marta specializes in representing hospitality industry clients in all aspects of labor and employment including labor-management relations such as union prevention, collective bargaining for single as well as multi-employer bargaining units, neutrality agreements and defense of unfair labor practice charges before the NLRB. She defends employers in administrative and litigation claims, such as employee claims of sexual harassment and discrimination and counsels clients in preventative strategies such as executive training, arbitration enforcement, and policies and procedures. To read Marta's articles, go to www.HotelLawBlog.com and select "Labor & Employment." For more information, please contact Marta Fernandez at 310.201.3534 or at mfernandez@jmbm.com.

Catherine DeBono Holmes

Catherine DeBono Holmes is a partner in JMBM's Corporate Department and a senior member of JMBM’s Global Hospitality Group® -- a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe. Cathy assists hotel clients with hotel management and franchise agreements, purchase and sale transactions, and condo hotel regime structuring. She has taken hotel owners through complex RFP processes involving all the major hotel brands. She has significant expertise in condo hotels and advises clients in the specific business and legal aspects of condo hotel regime structuring and documentation, including CC&Rs, HOA docs, unit management agreements, shared facilities agreements, rental management agreement programs and securities compliance matters (structuring, documentation and training). To access Cathy's articles on www.HotelLawBlog.com, click on the topics "Condo Hotels" or "Green Hotels" For more information, please contact Cathy Holmes at 310.201.3553 or cholmes@jmbm.com.

Guy Maisnik

Guy Maisnik is a partner in JMBM's Real Estate Department and a senior member of JMBM's Global Hospitality Group® -- a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe. Guy's deep and broad transactional practice includes complex real estate finance and venture capital transactions, including project finance, commercial finance, leveraged leasing and real estate acquisitions. He assists clients with development, leasing and disposition, loan portfolio acquisitions, loan and debt restructure, workouts and real estate exchanges. Go to www.HotelLawBlog.com for current information in these areas. For more information, please contact Guy Maisnik at 310.201.3588 or mgm@jmbm.com.

David Sudeck

David Sudeck is of Counsel in JMBM's Real Estate Department and a senior member of JMBM’s Global Hospitality Group® -- a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe. David has significant experience in the vacation ownership arena, focusing on the formation and registration of condominiums, timeshares and fractional interest regimes. He negotiates hotel, spa and restaurant management agreements, and assists client in the development, acquisition, sale and leasing of hotels, golf courses and restaurants. For David's take on current issues in the timeshare arena, go to www.HotelLawBlog.com and click on the topic, "Timeshare." For more information, please contact David Sudeck at 310.201.3518 or dsudeck @jmbm.com.

Robert Kaplan

Robert Kaplan is a partner in JMBM's Bankruptcy, Insolvency and Restructurings Group and a senior member of the Global Hospitality Group® -- a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe. Bob represents lenders, special servicers, hard money lenders, community banks, national banking associations, distressed debt investors, and equity investors, positioning them for the best possible outcome by acting expeditiously to preserve value and increase cash flow. His industry experience and his knowledge of the current capital markets -- where distressed assets often include complex deal structures and securitized loans -- allows him to bring creative and effective strategies to the table. When aggressive litigation is the best strategy, he is a vigorous and effective advocate for his clients. Bob represented the securitized lender in the Chapter 11 bankruptcy case filed by the Clift Hotel in San Francisco, and in the subsequent negotiations and successful sale of the loan to a third party. The lender -- acting by and through GMAC Commercial Mortgage Corporation as special servicer -- was the holder of a $60 million loan secured by a Deed of Trust on the Clift Hotel. He has also served as counsel to CapMark, J.E. Robert Company, Inc., AMRESCO Management Inc. and Midland Loan Servicer in their capacity as special servicers on troubled hotel loans in CMBS pools. For more information, contact Robert Kaplan at 415.984.9673 or rkaplan@jmbm.com.

Martin Orlick

Martin Orlick is a partner in JMBM's Real Estate Department and a senior member of JMBM's Global Hospitality Group® -- a team of 50 seasoned professionals with more than $60 billion of hotel transactional experience, involving more than 1,300 properties located around the globe. Marty specializes in representing hospitality industry clients in Americans With Disabilities Act (ADA) compliance and defense. He has represented more than 500 businesses in ADA issues, many of them hotels and restaurants, as well as hotel mixed-use properties. Marty is a member of the American College of Real Estate Lawyers (ACREL) and a frequent speaker on the ADA and other topics. To read Marty's articles, go to www.HotelLawBlog.com and select "ADA." For more information, please contact Marty Orlick at 415.984.9667 or morlick@jmbm.com.

James Abrams

James Abrams has significant experience in government affairs at the national level, the state level – including the California Legislature and scores of state agencies – and with local governments and agencies. He has authored successful ballot measures and scores of bills for his clients. Jim served as the President and CEO of the California Hotel & Lodging Association from January 1, 1991 through December 31, 2008 and is currently an adjunct professor in the Hospitality Industry Management Program at the University of San Francisco. He is a frequent speaker and writer on all aspects of the law relating to the lodging and hospitality industries, and he is the author of the book Laws Pertaining to the California Innkeeper, which is published by the California Hotel & Lodging Association. To read Jim’s articles, go to www.HotelLawBlog.com. For more information, please contact Jim Abrams at 415.398.8080 or jabrams@jmbm.com.

Eudeen Chang

Eudeen Chang is a lawyer in the Litigation Department of JMBM's Orange County office and a member of the Global Hospitality Group®. He represents hotels in a variety of litigation matters, including ADA defense. He is well-versed in all aspects of litigation, from pre-lawsuit strategizing to trial, post-judgment collection and through appeal. He also serves as outside general counsel for a number of small and mid-sized companies and high net-worth individuals. Contact Eudeen at EChang@jmbm.com or 949.623.7232.

Victor Shum

Victor Shum is a corporate and securities partner in JMBM's Corporate Department and a member of JMBM's Global Hospitality Group® and Chinese Investment Group™. He has advised clients on EB-5 matters since 1999 and assists hotel developers on EB-5 financing as well as public and private securities, mergers and acquisitions, cross-border issues, and other strategic business transactions, including real estate transactions and intellectual property and technology licensing matters. For more information, contact Victor Shum at 415.984.9611 or vshum@jmbm.com.

Scott Brink

Scott Brink is a senior member of JMBM's Global Hospitality Group® and a partner in JMBM's Labor & Employment Law Department. Scott is a management labor lawyer with more than two decades of experience representing employers in all aspects of labor relations and employment law including union prevention, collective bargaining negotiations, defense of unfair labor practice charges before the NLRB, wrongful discharge litigation, individual and class action employment discrimination and wage-and-hour claims, sexual-harassment litigation, arbitrations, personnel policies, California wage and hour law, and employee discipline and discharge. An experienced trial attorney, Scott has litigated a number of high-profile and complex cases involving a wide range of labor and employment law matters. For more information, contact Scott Brink at RSB@jmbm.com or 310.785.5365.

Travis Gemoets

Travis Gemoets is a partner in JMBM's Employment and Labor Department and a member of JMBM's Global Hospitality Group®. His clients include hotel owners, investors, and managers across the globe as well as hospitals, restaurants, professional offices, and manufacturing plants, to name a few. An experienced trial lawyer, he represents management in all facets of labor and employment law, including claims of discrimination, harassment, wrongful termination, wage/hour class actions, union/management contract negotiations and disputes, trade secrets, unfair competition, and workplace violence. Travis advises employers nationwide on these areas as well as on disability and religious accommodation, protected absences, personnel policies and handbooks, employee discipline and discharge, and labor relations. Contact Travis at TXG@ jmbm.com or 310.785.5387.

Global Hospitality Group®
1900 Avenue of the Stars
7th Floor
Los Angeles, CA 90067
Direct: (310) 201-3526
Direct Fax: (310) 712-8526
E-mail: jbutler@jmbm.com

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Ask The Hotel Lawyer ™

Ask the Hotel Lawyer™ is a quarterly column that I write for JMBM's Global Hospitality Advisor®. If you have a question you would like to submit to Ask the Hotel Lawyer™ please use the comments box below. While your question may not be of sufficient general interest for the column, I will try to respond to you individually if you leave your contact information below. Jim Butler.