Articles Posted in Hotel Mixed-Use

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5 March 2013

Hotel Lawyer on adding a hotel to shopping centers and malls.

The ULI program held on February 20, 2013 in JMBM’s Los Angeles offices was a great success. The program title says it all — “Back to the Future: The Renaissance of Hotel-Retail Mixed-Use.”

As one might expect for a ULI event on a timely topic like this, there was a capacity crowd, sharing of the latest “technology” in adding hotels to shopping centers, and a veteran team of presenters.

Jim Butler, Chairman of JMBM’s Global Hospitality Group®, moderated the panel, which included:

  • Guy Maisnik, Partner and Vice Chairman of JMBM’s Global Hospitality Group®
  • Steve Mermell, Assistant City Manager, City of Pasadena
  • Bruce Baltin, Senior Vice President, PKF Consulting
  • Les Melcher, SVP – Business Development, Woodbine Development Corporation

    • The panel looked at why many shopping center owners and developers are adding hotels to their projects, and commented on some tips and traps along the way. There were some great case studies that the panelists worked on.

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    28 January 2013

    We are at the beginning of what looks to be a renaissance of “hotel-retail mixed-use” development. Shopping center developers nationwide are exploring the feasibility of adding a hotels to existing retail properties, while others are already implementing plans that have been in the pipeline. Some are adding hotels to the mix for new ground up development. Fueling this trend is research showing that both retailers and hoteliers make huge gains in revenue when they come together in the “hotel-retail mixed-use” environment.

    My partner, Guy Maisnik, and I recently wrote an article on this subject for Hotel Business and it is reprinted below, with permission.

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    17 December 2012

    A wave of “hotel-retail mixed-use” is coming. It may mark the rebirth of bricks and mortar.

    Put on the back burner by the Great Recession, the hotel-retail mixed-use development is back in play. Virtually every major shopping center and mall owner is exploring whether it makes sense to add a hotel component to existing projects, and are checking feasibility for new ones. Some new hotel-retail projects are underway, and many others are in the planning stage.
    What’s behind this trend is a simple and powerful driver: The right hotel added to the right project can boost retail sales by 20-40%! And the retail shopping can boost hotel RevPAR by a comparable amount over the competitive set.

    My partner, Guy Maisnik, and I were asked by Globe St to write a guest column for their publication on the hotel-retail trend. It is reprinted below, with permission.

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    28 April 2011

    Hotel Lawyer with more on the long-term future of condo hotels.

    It is interesting that I got calls from two reporters about the state of the condo hotel sector this week. One from a major daily paper doing background research, and the other from a well-respected industry publication, MortgageOrb, published by Zackin Publications (which also publishes Commercial Mortgage Insight and Secondary Marketing Executive.)

    Condo hotels have not been in the news for some time, and as hospitality transactions heat up, many are now wondering how and when this niche product will be resurrected.

    Phil Hall of MortgageOrb asked some excellent questions about the condo hotel sector and our interview, titled Jim Butler Checks Out the Condo-Hotel Niche, published in MortgageOrb’s Person of the Week column, is reprinted below.

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    14 April 2011

    Hotel Lawyer with good news for well-structured condo hotel deals. With the experience gained as legal and business advisors on more than 100 condo hotel and hotel condo projects, we have said for many years that this type of project has earned an enduring place in the landscape of hotel and real estate development. We still believe that.

    The main issues of successful hotel mixed-use development are managing consumer expectations, fulfilling those expectations, and creating a viable mixed-use regime structure. In the case of condo hotels, a viable structure must work from an operational standpoint, be economically sustainable, and avoid triggering violations of Federal and State securities laws.

    In a recent lawsuit, involving the Hard Rock Hotel San Diego, a federal district court in California ruled against the condo hotel buyers, finding that no securities laws were violated — the plaintiffs did not allege facts that would cause the condo hotel units to constitute “securities.” We see the case as affirming the effectiveness in defeating plaintiffs’ claims of two structural elements we have encouraged all our clients to use.

    My partner, Catherine Holmes, who structures most of our condo hotel regimes, talks about these factors and the case below. Catherine advises clients in the specific business and legal aspects of condo hotel regime structuring and documentation, including securities compliance matters, documentation and training. In her article below, she talks about the case and what it means for us in the condo hotel world. It is good news!

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    22 November 2010

    Mixed-use can be a key to unlock value. But “standards” can be critical to protect the value of your hotel mixed-use asset

    Some years ago, we coined the term “hotel-enhanced mixed-use” to describe those dynamic mixed-use properties where the hotel acts as the “spark plug” that energizes the entire project.
    Hotels can be the “ultimate amenity” for mixed-use projects because they can distinguish the project, provide a great driver of traffic, and offer an integrating hub for residential and retail customers.

    Since that time, we have seen hotels in successful mixed-use properties achieve RevPAR premiums of 30% to 40%. But these success stories are written about hotel developers and brands that understood — on the front end — that quality control had to be hard-wired into the regime. Hotel owners and hotel brands that failed to do that have not been so lucky.

    In her article below, which was recently published by Hotel Business, hotel lawyer Catherine Holmes, a senior member of the JMBM Global Hospitality Group®, offers experienced advice on how you can “Protect your mixed-use asset by creating and maintaining standards.”

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    4 February 2009

    Hotel lawyer in Beverly Hills at the ULI “Reinventing Retail and Mixed-Use” program, the Beverly Hilton, Beverly Hills, California, February 4-5, 2009. The Urban Land Institute’s big retail conference is underway and one of the lead off panels had some great information about why hotels are being added to retail mixed-use projects.

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    5 January 2009

    To say the least, the last year has been a very “interesting” one. Here are our picks for “The Best from HotelLawBlog.com” from 2008. There are some classic pieces here!

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    Author of www.HotelLawBlog.com
    13 May 2008
    Here is the presentation from Bobby Bowers of Smith Travel Research. (bobby@smithtravelresearch.com or (615) 824-8664) at JMBM’s recent Meet the Money® conference. This is an excellent overview of where the hospitality industry has been and where we are going.

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    Author of www.HotelLawBlog.com
    21 April 2008
    Keywords:

    Hotel Operating Agreement, HOA, Hotel Management Agreement, HMA, Hotel Management Contract, Management Contract. Hotel Operator, Hotel Manager, Hotel Owner. RFP for Hotel Manager. RFP for Hotel Operator, How to get a great hotel operator.

    Terminology

    Contracts between hotel owners and managers (or operators) controlling the management of a hotel go by various names. They are called hotel management agreements, HMAs, hotel management contracts or hotel operating agreements. For convenient reference, this article will generally use the term “Hotel Management Agreement” or “HMA.” However all these terms can be used interchangeably and mean the same thing, just as with hotel operator or hotel manager.

    Whatever they are called, Hotel Management Agreements allocate risk between the hotel manager and the hotel owner. They are critical in determining the profitability and value of a hotel.

    Hotel Lawyer on hotel management agreements. Long-term, no-cut hotel management agreements: How to get the right brand and operator for your hotel project . . . and a deal you can live with.
    The successful matching of a hotel brand and operator with an asset and its owner is an important determinant of the financial and operational success of a hotel project. Aside from the right “marriage” partners, the terms of the management contract tying them together is critical, because it will likely govern the relationship for decades and is hard to change once cast.

    Question: What’s more important for your hotel project than getting the “right” brand and operator?

    Answer: Not much! Finding the right operator or brand for your project — and achieving reasonable terms — can make a significant and positive impact in key areas: value, financing, and operational success.

    So how do you do that?

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