Along with Mike Cahill of Hospitality Real Estate Counselors (HREC) and Sean Hennessey of the Lodging Investment Advisors, I am privileged to be one of the co-chairs of the Lodging Industry Investment Council (LIIC). LIIC is the hotel industry "think tank" whose membership owns or operates many billions of hotel investments, and involves all aspects of the industry.

LIIC Annual Survey

I am grateful that Mike Cahill takes responsibility for analyzing LIIC's annual survey of lodging investment trends and challenges, a highly regarded profile of investment sentiment and attitudes for the lodging industry for the next 12 months.

This survey results in the annual "LIIC Top Ten", which Mike delivered to more than 350 participants at the 22nd annual conference of Meet the Money® today.

Economy is top concern

You won't be surprised that the economy remains the biggest concern among LIIC's members. But some of their beliefs about where things are headed are less obvious and very interesting.

If you were not in attendance, you missed Mike's personal insight. But the presentation is available on HotelLawyer.com. It is brief and straightforward, as was his delivery today. For a snapshot of what industry leaders are thinking about right now, click here.

Hotel Lawyers in Los Angeles at JMBM's Meet the Money® 2012

The hotel lawyers at JMBM'S Global Hospitality Group® were out in force and mingling with about 350 hotel industry leaders that joined us in Los Angeles this week for the 22nd annual Meet the Money® 2012 conference.

What is different about Meet the Money®?

There is a lot to like about this conference. We are not in the conference business, and we don't make a profit on this event, so we run the conference at the highest level of excellence and the way we think best suits business-oriented deal makers. For instance:

• Substantively, everything has a strong focus on financing, value, and liquidity.
• It is an efficient (one level) venue where you can see everybody and is not too crowded.
• You see deal makers, not product electronic key or astro turf vendors.
• It is a comfortable venue with great food (breakfast, lunch and receptions) and constant snacks (fruit, yogurt, juice, soft drinks, energy bars, and the like).
• The program starts and ends on time.

What's different this year from last year?

Well, last year, hotel transactions were coming back online and there was plenty of excitement.

This year, although it seems like just about everyone has a recent deal to discuss and more in the pipeline, things are more sluggish. The experts look for the second half of the year to be much stronger, making a mirror image of 2011.

As usual, there was lots of conversation and plenty of business cards being exchanged in the hallways, and there was a large crowd at the Grand Welcome Reception that talked for hours into the evening (the great food and the poolside venue may have been a factor!).

Quick take aways

If our participants are any indicator of what's going on in the hotel marketplace, there is a reason for optimism. Here are some of the common conversational and conference themes:

Hotel Lawyer ADA defense alert: Charles Schwab settles claim over website accessibility under the Americans with Disabilities Act

On May 2, 2012, Charles Schwab & Co. announced an initiative to make its website more accessible for all customers, particularly those who are blind or have sight disabilities. This high-profile development was part of the settlement of a claim by Kit Lau, a Charles Schwab customer for more than 25 years.

While many have focused on the Americans with Disabilities Act's (ADA's) ever-changing pool lift requirements, we continue to see the DOJ and private advocacy groups driving to enforce the original regulations promulgated 20 years ago under the ADA. As of December 31, 2011, more than 13,130 lawsuites had been filed under the ADA, and the trend continues to grow.

Here is what Marty Orlick, the head of our ADA compliance and defense group, and I think the Schwab matter may mean to you.

Charles Schwab settlement is one of 15 prominent web site settlements

Charles Schwab, one of the nation's leading securities broker-dealers, and a disability rights advocacy attorney, announced last week that they settled a year-long claim by a blind customer that its website was inaccessible to blind, low vision and cognitively challenged customers. The structured negotiations concluded this dispute short of trial.

With this settlement, Charles Schwab joins a list of 15 prominent companies which have settled website accessibility complaints. Charles Schwab agreed that it will make its website more accessible and inclusive for all customers, and agreed to implement the Web Content Accessibility Guidelines (WCAG) Version 2.0 Level AA which will make its website navigable by disabled customers.

An informal complaint backed by the threat of litigation and administrative investigations was lodged with Charles Schwab by the lawyer for a blind day trader. The claimant was a long-time Schwab customer and herself a computer programmer. One morning, she found that she could no longer navigate the Schwab website using JAWS software and was prevented from making trades on-line. The JAWs software reads aloud the text of the page so blind and low vision customers can access the website.

EB-5 LAWYER ALERT: California has adopted a new TEA policy as of April 30, 2012. It will severely affect California's ability to compete for
EB-5 financing.

My partners, Catherine Holmes and Victor Shum, have alerted us to an important new development that will affect new development projects in California.

The State of California has decided that it will not certify any new "targeted employment areas" or TEAs under the EB-5 immigrant investor visa program.

If you develop hotels and other real estate, you are well aware of the financing opportunities provided by the EB-5 immigrant investor visa program -- and you are also know the importance of locating your project in a TEA. (If you are new to the intricacies of EB-5 financing, check out our articles on the topic on the Hotel Law Blog.)

The purpose of the EB-5 financing program is to create new jobs for Americans using investment from foreign investors who want to get a green card. Hotel developers, who have been unable to develop projects for years because of lack of traditional financing, are successfully using for new projects.

Our hotel lawyers have advised clients on more than 40 EB-5 projects, and we know this program is working. There are cities and counties throughout the U.S. -- including California -- that want these projects and the jobs that come with them.

For the full story, read the article below. We hope you will be moved to contact your city and state representatives and let them know that restricting TEA designations will restrict economic growth! This action is contrary to what virtually every other state in the Union is doing. Some of the biggest states have gone to great lengths to facilitate TEA designation both with speedy processing (it normally takes only 24-48 hours to get designation) and by flexibility in finding ways to meet the requirements. Why would California turn away this "free capital" from foreign investors to create jobs for Americans? Something is wrong.

Hotel Lawyer in Los Angeles at Meet the Money® 2012

My staff and I are making final preparations for the 22nd Annual Meet the Money® conference and I couldn't be more excited! This year's theme is "Rise above the global financial tempest" and our speakers are ready to share the experience, knowledge and insight that enables them to find financing, create value and get deals done in the midst of our current global challenges.

The National Law Journal (NLJ) published its Midsize Hot List this week, and we are pleased that Jeffer Mangels Butler & Mitchell LLP was included as one of only 20 firms selected.

How the selection process works

In its national survey, the NLJ judged firms by how they stood out from their competition, what made them distinct in terms of organization and operations, and by the key matters the firm handled for clients in 2011. As part of that process, the NLJ's researchers contact the firm's clients for their input.

According to the National Law Journal, the 20 law firms that comprise its 2012 Midsize Hot List "are good at what they do, but they're also good at how they do it".

Known globally for hospitality

In its profile of Jeffer Mangels Butler & Mitchell LLP (JMBM), the National Law Journal noted that the firm has many successful practices in industry niches, being best known globally for its Global Hospitality Group®. Particular note was also made of the related activities of our Chinese Investment Group® in both EB-5 and inbound investment from China.

At JMBM, we believe that clients benefit from industry specialization. When a lawyer has deep experience in an area, you are almost certain to get a better outcome. Not only that, you will get it faster, cheaper, and with less risk. I have always reminded our clients -- hotel owners, developers and capital providers -- that hotels are NOT just real estate. Hotels are complex operating businesses, integrally intertwined with special-purpose real estate. So when you have an important hotel matter, why would you go to a just a real estate lawyer? You need a hotel lawyer!

What our clients think

It's always nice to be recognized for one's work but, for me, it was most gratifying to read the comments made during the reference checking by Warren Ernst, senior city attorney for the city of Dallas, for which our hotel lawyers conducted a request for proposal -- using JMBM's HMA Pro™ approach -- for hotel brands to manage its large convention center hotel. (We assisted in the selection process and then negotiated a "qualified hotel management agreement" meeting the requirements of the Internal Revenue Code for a project financed with tax-exempt bonds.) Here's what he told the National Law Journal:

Warren Ernst, a senior executive assistant city attorney for Dallas, said that Jeffer Mangels "made a very complex component of the project go efficiently, while assuring the city's leaders and managers that the city's interests were being very well protected. JMBM was critical in providing both legal and practical business advice throughout the process. "

Our goal has always been to be more than "just" excellent hotel lawyers, but to also bring business advice -- both practical and strategic -- to each of our client's projects. For sophisticated clients who don't have expertise in hospitality, like Warren's team at the city of Dallas, our team provides hotel-specific knowledge about what is "market" or "customary." We can help them understand what's a fair deal and how to get it. Applying creative and unusual approaches, like our HMA Pro™ approach to finding a great hotel operator, we can add value and help to solve sticky problems.

Hotel Lawyer with some insights on the recent California Supreme Court Case, Brinker v. Superior Court

Last week, the California Supreme Court gave employers a "break" by resolving issues in a case that has been pending since 2008 -- issues that have cost California employers more than a billion dollars in settling and defending class action lawsuits.

At issue in Brinker Restaurant Corporation v. Superior Court was whether California employers must ensure that their employees actually take their meal and rest periods or merely make them available. To the collective relief of California employers, the court found that an employer must only provide meal and rest periods to its employees, leaving the employees free to use the period for whatever purpose they desire. The employer is not obligated to ensure no work is performed during the period.

My partner, labor and employment lawyer Travis Gemoets, offers some practical pointers to employers based on the Brinker decision, in his article below.

While it is always great to share positive news with our friends in the hospitality industry, the Brinker decision also reminds us of the critical need for clear, sound employee policies, and the importance of providing regular, ongoing education to supervisors who implement those policies.

JMBM's Global Hospitality Group® includes labor and employment lawyers with deep experience in the hospitality industry, providing clients with practical advice and planning, as well as aggressive advocacy. If you would like to discuss how our industry-specific prevention and preparedness strategies can help you avoid or minimize costly employment claims, or how the Brinker decision impacts your hotel operation, please contact me or my partner, Travis Gemoets.

EB-5 financing is one of the few serious financing options available to hotel developers

EB-5 financing has become an important source of financing for hotel development in the past few years. And hotels have become a favored class of investment for foreign investors seeking to get their green card with the required investment of capital. Quite a few projects are being funded in this way, and some of the big hotel companies - but most notably Marriott - are encouraging their developers to look into EB-5.

The hotel lawyers at JMBM's Global Hospitality Group® have worked on (or are now working on) more than 40 such EB-5 hotel financing projects. We still seem to be at the early part of this wave, investor interest continues strong, and more people are getting on board. In addition, the construction and development financing part of hotel financing spectrum continues to be the most difficult to arrange, so EB-5 financing looks pretty attractive.

It also looks like these EB-5 deals are accomplishing their intended purpose well. They attract wealthy foreign investors, who bring fresh capital into the United States to invest it in building hotels and creating at least 10 jobs for Americans for each investor.

A new wrinkle being created by the USCIS

But a new wrinkle has recently been created by the U.S. government agency charged with monitoring the EB-5 process, the U.S. Citizenship and Immigration Services ("USCIS"). The USCIS is starting to question under what circumstances hotel jobs created by a new hotel development should be counted for purposes of EB-5 financing - - at least when the hotel operator hires the new employees under the industry-standard form of hotel management agreement. In so doing, it appears that the USCIS may be wondering if jobs with the hotel operator should be treated the same as jobs with tenants under an office or retail lease.

The article below from my colleagues, Catherine Holmes and Victor Shum, explains the latest issue and why hotel employees should be treated as employees of a hotel project, regardless of whether they are employed by the hotel owner or a hotel manager. We think this analysis will be of greatest interest to our friends in the EB-5 community who may not be familiar with the hotel industry.

Hotel Lawyer ADA defense alert

Significant legislation has been introduced with AH&LA support to provide relief for ADA compliance on pool lifts. So my ADA expert partner, Marty Orlick, and I thought it might be helpful to explain what is going on, and what it likely means to you. Here is what is happening . . .

One year delay for ADA pool lift requirement

On March 26, 2012, the AH&LA announced support for legislation introduced to force a 1 year delay in enforcing the ADA pool lift requirement. The bill was introduced by Congressman Mick Mulvaney (R-SC) and has 26 original co-sponsors.

Authorize portable pool lifts, sharing lifts and protection for hoteliers during delay

In addition to delaying effectiveness of the pool lift requirement that was originally scheduled to be effective March 15, 2012 and then delayed 90 days until May 15, 2012, the proposed legislation would give some other much-sought-after relief.

It would allow the use of portable pool lifts, and allow sharing of lifts among pools. Both of these alternatives were belatedly prohibited by the Department of Justice's January 31, 2012 interpretation of its final rules, and would be overturned by the legislation if adopted.

Significant relief for the hotel industry

According to AH&LA President/CEO Joe McInerney. "Portable lifts will allow hoteliers to protect guest safety, while accommodating guests with disabilities. The delay will allow hoteliers the time to implement the necessary changes without the fear of lawsuits."

Hotel Lawyer: Are you thinking about negotiating a new hotel management agreement? Here are 10 things to consider about making your process smoother and more successful.

It seems like hotel management agreements are on everyone's mind these days. Development is coming back. Many owners of existing property are repositioning their hotel properties. And old management agreements continue to expire or occasionally are terminated.

In any event, we have been getting a lot of calls lately to help owners, developers, investors (and some lenders who have become owners) negotiate new hotel management agreements. One of the first questions usually raised is how the process of negotiating a management agreement works, with all the different parties involved, usually in different parts of the country (or the world).

So my partner Bob Braun and I decided to share the process we usually use with clients to streamline the process. Let us know if you have any thoughts or insights on this.

ADA Defense Lawyer: What does the ADA pool lift compliance extension of May 15 mean for you?

First, let's be clear that all compliance dates have NOT been extended!

Extended deadline for pool lifts is May 15

Responding to concerns expressed by the hotel, pool and spa manufacturing industries, and those of a number of U.S. Congressmen, on March 15, the White House plunged into the swimming pool access controversy by issuing a 60-day an extension to implement the 2010 ADA Standards for pool lifts. As a result of this action, the new deadline for installing pool lifts is May 21, 2012, but that too may change.

March 15 deadline remains for all other provisions of new ADA Standards

The March 15, 2012 compliance date remains in effect for all other provisions of the 2010 Standards. The Department of Justice will soon publish a Notice of Proposed Rulemaking giving the public 15 days to express their views. We expect the hotel and pool and spa industries will take a much more active role in the public comment process than they did when the 2010 Standards were initially open for comment.

Events have been moving very fast when the official government position changes 180 degrees in less than 24 hours. And that his what has happened. So my ADA expert partner, Marty Orlick, and I thought it might be helpful to explain what is going on, and what it likely means to you.

Here it is . . .

ADA Defense Lawyer with latest update on pool lift compliance date!.

Yesterday, March 14, the Department of Justice declared that it was taking a hard line on the March 15 ADA pool lift compliance date refused any extension of the compliance deadline.

Today, in a significant turnabout, Attorney General Eric Holder signed a final rule extending the compliance deadline on ADA pool lift for 60 days until May 15, 2012.

Official statement from DOJ

Here is the official statement from the Department of Justice ADA website (www.ada.gov):

On Thursday, March 15, 2012, Attorney General Eric Holder signed a final rule extending the date for compliance with sections 242 and 1009 of the 2010 Americans with Disabilities Act (ADA) Standards for Accessible Design as it relates to the provision of accessible entry and exit to existing swimming pools, wading pools, and spas for a period of 60 days after the publication of the rule in the Federal Register. On that same day, the Attorney General also signed a Notice of Proposed Rulemaking(NPRM) seeking public comment on whether a longer period of time would be appropriate to allow pool owners and operators to meet their compliance obligations. Specifically, the NPRM proposes a 180-day extension of the deadline. Comments on the NPRM will be accepted for 15 days after publication in the Federal Register.

Immediate 60-day Extension of Compliance Date for Existing Pools

New hotel development is back! And there is something you should know about how hotel development is being financed. It is not easy, but developers are getting new hotel developments financed. One important capital source is foreign investors using the EB-5 immigration visa investment.

We have advised clients on more than 40 EB-5 projects, and along the way we have written quite bit about EB-5 financing for hotel projects. We aren't going to repeat the ground covered earlier, but you will find references at the end of this article if you want to read our other materials on this subject.

Today's focus is on unlocking EB-5 capital for hotel development with the right "regional center" and then what you need to know about negotiating the terms of your EB-5 financing deal. Catherine Holmes and Victor Shum share their thoughts.

Hotel investment through buying hotel notes As the economy and hotel fundamentals continue to improve, hotel note purchase opportunities will be one of the most attractive hotel investments for savvy investors.

My partner and Vice Chair of our Global Hospitality Group®, Guy Maisnik, has been working a lot on note purchases lately, and I asked him to share some insights with us, which he graciously consented to do with his article today.

As you should know by now if you are following developments on the Americans with Disabilities Act (or ADA), the most sweeping changes to the ADA in 20 years become effective on March 15, 2012.

It seems that almost every day there is some new development or interpretation of the new rules. For an up-to-date summary of some key provisions, please see articles listed at the end of this posting.

A number of us in the hotel industry have been visiting the DOJ's Civil Rights Division to get clarification on the recent DOJ guidance on "fixed" pool lifts.

Congressmen intervene with DOJ on pool lift issues

Last week, two prominent Congressmen, Mike Mulvaney and Todd Rokita, jumped into the fray with a letter to DOJ (see below) acknowledging its important efforts to provide swimming pool access to the disabled community. Here are a few highlights from the letter and the full text is below.