Articles Posted in Meet the Money®

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Tom Corcoran, Chairman of the Board of FelCor Lodging Trust, speaks with David Sudeck, senior member of JMBM’s Global Hospitality Group® at JMBM’s 2016 Meet the Money® – the national hotel finance and investment conference. They discuss “rational debt,” redevelopment opportunities, and the evolution of FelCor.

A transcript follows the video. See other videos in this series on the Jeffer Mangels YouTube channel.

David Sudeck: I’m David Sudeck, I’m at the 26th annual Meet the Money® conference with Tom Corcoran, the founder of FelCor Lodging Trust. Thank you for joining us. You just got off your panel and you did a great job, so thank you for that. I wanted to hear about in this uncertain time, 2016, where you see us in the market at this point and how it may differ from 2015.

Tom Corcoran: Actually, I think it’s going to be a lot like ’15. I think ’16 and ’15 are going to be very similar. I think we’re going to continue to have positive RevPAR above the GDP and so I think it makes a lot of sense to me that the industry remains very strong; robust. There’s some clouds out there, people are trying to say there’s a storm coming, and I just don’t happen to believe there is. I think those clouds are artificially made up and aren’t really in the real world.

David Sudeck: My experience is some of our lender clients are pulling back in terms of the provisions, particularly of construction lending.

Tom Corcoran: Yeah, I think that’s probably good, I’m okay with that. When people go through getting nervous before things really are bad, it has the net effect of acting as a governor – which is why I call it a governor – because it kind of stops irrational lending. Most people believe supply is the worst enemy of the hotel industry and I would argue that it’s debt that creates the supply. The source, historically, of all the downturns has been where people have borrowed too much money – even in some of the worst cycles we’ve gone through – people had non-recourse, 100% financing. Then people can build hotels that make no rational, economic sense at all.

David Sudeck: So where do you see opportunities in this market given the lack of liquidity? I think that the number of hotel developers is going to shrink, supply will pull back to some extent. Do you see any specific opportunities in this marketplace? CONTINUE READING →

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Bill Blackham, President and CEO of Condor Hospitality Trust, speaks to Bob Braun, senior member of JMBM’s Global Hospitality Group® at JMBM’s 2016 Meet the Money® – the national hotel finance and investment conference. They discuss Condor’s transition from economy chain scale into select service, extended stay and limited service hotels,  RevPAR, and opportunities in the select service sector.

A transcript follows the video. See other videos in this series on the Jeffer Mangels YouTube channel.

Bob Braun: I’m with Bill Blackham of Condor Hospitality Trust. Bill, thanks very much for taking out the time to talk to us today. What are you currently working on? What’s Condor focused on these days?

Bill Blackham: Condor has been involved over the last year in a lot of different initiatives that involve the transition of the company from once being an economy chain scale-focused entity into a select service, extended stay and limited service hotel company, with a platform that is growing in that new investment strategy at the same time that we are divesting the old investment strategy hotels. Therefore, you have multiple things going on at the same time. Combined with a recent private placement of equity into the company with a new investor, it’s been a very busy time.

Bob Braun: So, what drove this shift from the economy (sector), up the ladder a little bit to the limited and select service?

Bill Blackham: I think that the potential for stock growth was far greater in the space that we’re now pursuing. One of the problems with the sector that the company had previously been in is that the average size hotel was very small. And in order to get to a very meaningful scale to justify being a public company, one would have to own four-, five-, six-hundred of those hotels, which is unwieldy from the standpoint of managing that platform.

I think that the platform that we’re going into also affords us the opportunity to have greater investor interest because it is a sector that continues to have above-industry growth in terms of demand, while at the same time is a space that has much higher margins than we are, as a company, traditionally in. So the higher margins combined with sort of a void in the space, the public company space of people that we’re going specifically after, the geographic markets that we’re pursuing, and the type of products that we’re pursuing really left an opportunity open to get highly accretive acquisitions.

Bob Braun: So this is an open space for you. Do you see yourself moving further? Do you see yourself ever developing into the full service area? CONTINUE READING →

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Jonathan Falik, CEO of JF Capital Advisors, speaks with David Sudeck, senior member of JMBM’s Global Hospitality Group® at JMBM’s 2016 Meet the Money® – the national hotel finance and investment conference. They discuss the current hotel market, the availability of capital, and what lenders and capital providers are looking for.

A transcript follows the video. See other videos in this series on the Jeffer Mangels YouTube channel.

David Sudeck: We’re at the 26th Annual Meet the Money Conference. I’m here with Jonathan Falik, CEO and Founder of JF Capital Advisors. Welcome.

Jonathan Falik: Thank you for having me.

David Sudeck: You’ve been a mainstay at Meet the Money® – we appreciate that, by the way.

Jonathan Falik: Well, it’s one of my favorite conferences.

David Sudeck: What’s the temperament like in terms of the marketplace?

Jonathan Falik: People are cautious. Most seem optimistic, but are cautious and are in a learning mode. Everyone’s trying to figure out who’s saying what and who’s thinking what – which is interesting because normally people in our industry think they know everything.

David Sudeck: What are you seeing in the marketplace in general? Let’s talk about the cycle. CONTINUE READING →

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Click here for the latest articles on EB-5 Financing. 
Patrick Hogan, CEO of CMB Regional Centers, speaks with David Sudeck, senior member of JMBM’s Global Hospitality Group® at JMBM’s 2016 Meet the Money® – the national hotel finance and investment conference. They discuss the evolution of the EB-5 Immigrant Investment Visa Program, indirect jobs, completion guarantees, and taking care of the investor.

A transcript follows the video. See other videos in this series on the Jeffer Mangels YouTube channel.

David Sudeck: Hi, I’m David Sudeck, I’m here at the 26th annual Meet the Money® Conference with Pat Hogan, CEO of CMB Regional Centers. Welcome Pat. And thanks again for participating this year. You were on stage earlier on the CEO panel and you did a fantastic job.

Patrick Hogan: Well thank you, I’m pretty excited to be here. It’s an interesting group of people.

David Sudeck: EB-5 is hot right now. I was wondering if you could tell us a little bit about the roots of CMB, how things have changed from the 1990s to today, and what you see as your current platform.

Patrick Hogan: We started in 1994, before regional centers were ever involved.

The EB-5 program is actually a permanent program. Most people don’t know that because everybody does business with the regional center. But I started in 1997, getting my first regional center, and we actually got an approval in the year 2000. But as you know, fraud crept into that particular program and I just couldn’t take it anymore. It wasn’t really a business at that point in time. So I just said, “Okay, I quit, and until Congress can put some reforms through, I don’t want to do it anymore.”

David Sudeck: So you were pushing for regulation?

Patrick Hogan: Yes, even back then. So, fast forward to today – and we’ve been rocked with all kinds of scandals and things like that within EB-5 – which you would expect. Because if you go back to 2007 there were eleven regional centers, and maybe five of us doing something. And then to go to today where you have 800 regional centers – there’s bound to be some individuals that don’t have a clue.

David Sudeck: Do you have any sense as to how many of those 800 actually do business of any kind? CONTINUE READING →

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13 May 2016

Hotel industry fundamentals are good, and will continue to improve. But the hotel industry is being punished by the disconnect between the investment community of Wall Street and actual performance of the hotels on Main Street. More on the nature of this disconnect shortly, but first, here is the current situation as summarized by Vail Brown of STR last week at the 26th annual Los Angeles hotel investment conference, Meet the Money®.

STR_Page_26-1-e1463156527147

Total United States Key Performance Indicator Outlook (% Change vs. Prior Year) 2016 – 2017

Note that the actual results for 2015 and the forecast for 2016 and 2017 are pretty good – not as spectacular as they have been in some recent past years, but very sound in terms of long-term trends. Notice also that the average national supply growth is still below the 2% level that raises concerns for oversupply. Demand growth is continuing at a rate greater than supply growth, and that is healthy. While occupancy growth is modest, strong ADR growth is driving RevPAR growth at good levels.

Looking beyond the averages into specific markets

National average statistics are most informative when variations from the median are relatively small. Also, averages can be misleading when there are statistical outliers or even significant variations. That seems to be the case currently, with markets like New York City and Houston struggling, and significant localized damage in oil patch markets.

This problem is illustrated by this slide from Vail Brown’s presentation at Meet the Money®. Note that the declining RevPAR growth in New York City and Houston dragged down the entire industry averages. Many industry leaders believe that New York’s problems have also overly influenced the financial community’s perspective on the hospitality industry, incorrectly assuming that industry performance in New York City is representative of the entire industry. CONTINUE READING →

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07 May 2016

Meet the Money® 2016 – Deals, dialog and learning
Conference presentations now available

JMBM’s Meet the Money® 2016, completed its 26th national hotel finance and investment conference this week in Los Angeles.

While all seem to agree that hotel fundamentals remain strong and that interest rates will remain low in the immediate future, hotel industry leaders expressed more caution than in recent years. They are still doing deals – particularly those that fit into established strategies. In fact, there are a number of creative deals going on, of all sizes, and it is always exciting to hear from so many developers and capital providers who are enthusiastic about their work and the industry.

Many expressed a healthy respect for stricter underwriting and shared the lessons learned from the Great Recession. All our speakers and participants exchanged perspectives, ideas, business cards and lots of good stories.

Presentations available from Vail Brown of STR, Suzanne Mellen of HVS, Mike Cahill of LIIC and HREC, Dan Lesser of LW Hospitality Advisors, Alan Reay of Atlas Hospitality, and Bill Linehan of RLHC

Select presentations from Meet the Money® 2016 can be found on HotelLawyer.com. Individual presentations include: CONTINUE READING →

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To download the LIIC Top Ten presentation, click here.

(Denver, CO) For well over a decade, the members of the hotel industry’s preeminent think tank, “LIIC – The Lodging Industry Investment Council,” are annually surveyed to develop a list of the major hotel investment opportunities and challenges for the coming year. This exhaustive survey results in the LIIC Top Ten; a highly regarded profile of investment sentiment and attitudes for the lodging industry for the forthcoming 12 months. Altogether, the members of LIIC represent direct acquisition and disposition control of well over $40 billion of lodging real estate.

Members are highly active and have the pulse of the market, with 57% of LIIC hotel investors having successfully purchased a hotel in the last 12 months and 38% currently having additional acquisitions under a purchase and sale contract.

The hospitality industry’s most influential investors, lenders, corporate real estate executives, REIT’s, public hotel companies, brokers and significant lodging equity sources are represented on the Council. LIIC serves as the leading industry think tank for the lodging business (www.liic.org).

Mike Cahill, LIIC co-chairman, produced this year’s survey (www.mikecahill.com). Mr. Cahill is CEO and Founder of HREC – Hospitality Real Estate Counselors, a leading international hotel and casino advisory and brokerage firm (15 offices nationwide) specializing in lodging property sales, debt financing, consulting, appraisals and litigation support (www.hrec.com). Kyle Halbrook & Nate Shartar, Associates in HREC’s Denver office, assisted throughout the process.

2016 Top Ten LIIC Survey Results:

1. Hotel Investors: Active yet Cautious in Underwriting and Pricing: In a striking reversal from 2015’s unbridled optimism, the 2016 results reveal that investors are now underwriting more carefully and pricing an uncertain future into their acquisition bids. However, market participants, as a whole, remain positive and active.

2. Movement in the Hotel Real Estate Cycle?: After the past two years, when investors believed we were “real estate cycle stagnant” and solidly grounded in the 5th to 6th innings of the current lodging investment cycle, the 2016 survey is sensing strong movement. Today, 68% believe we have moved along to the 7th/8th innings and 17% go further, believing we are in the 9th inning. Similarly, 42% believe hotel real estate values peaked in 2015 and 28% believe values are currently peaking in 2016. When asked the same concept but worded differently, the current survey indicated 2006 (34%) was the most similar year in past cycle, with 2007 following closely behind at 28%. CONTINUE READING →

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Meet the Money® 2016 – May 2-4, 2016: 26th National Hotel Finance & Investment Conference in Los Angeles

Getting to the winner’s circle – marathon, sprint or obstacle course?

LOS ANGELES –  The 26th annual edition of Meet the Money®, the national hotel finance and investment conference, will be at the Sheraton LAX May 2-4, 2016. The conference will host hotel owners, developers, operators, brands, lenders, investors and other capital providers.

Conference speakers will explore financing, re-financing, development, and deals, as they try to answer the questions: what part of the investment cycle are we in? And what should you do about it?

“Industry fundamentals continue to be positive,” said Jim Butler, Chairman of JMBM’s Global Hospitality Group®. “Investor sentiment seems to be shifting. With the REITs on the sidelines, some see this as a great buying opportunity. Others see storm clouds on the horizon and seek shelter from investment risk. Uncertain times like this make it important to decide what strategies will get you to the winner’s circle.”

Meet the Money® 2016 will present 25 panels and special presentations featuring more than 100 industry leaders, including:

  • Thought leaders from the Executive Suite
  • Changes in Chinese investment in U.S. hotels, and what this means to you
  • Investment strategies in a changing market
  • Many panels with lenders, equity investors and other capital providers
  • Construction financing
  • Bread & butter financing
  • EB-5 financing
  • Buying and selling hotels
  • Optimizing hotel value with brands and management
  • Cybersecurity breaches and preventative measures
  • Dress for distress–avoiding pitfalls and finding opportunities

CONTINUE READING →

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24 June 2015

Bill Sipple, Executive Managing Director of HVS Capital, speaks in the video below about activity in different markets, limited service properties, and whether rising interest rates will have an effect on transactional activity.

Bill sat down with Bob Braun, a senior partner in the JMBM Global Hospitality Group®, as part of our video interview series on hotel finance and investment opportunities in 2015.

A transcript follows the video.

Bill Sipple discusses hospitality market activity and interest rates - Meet the Money® conference

Bob Braun: Hi, I’m Bob Braun. I am a Partner at Jeffer Mangels Butler & Mitchell. I’m here at Meet the Money® 2015, our 25th anniversary. I’m here with Bill Sipple, who is the Executive Managing Director of HVS Capital. Bill, thanks for coming by and talking with us.

Bill Sipple: It’s good to be here, thanks. CONTINUE READING →

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23 June 2015

Jack Westergom, Managing Director of Manhattan Hospitality Advisors, discusses hotel operating agreements, asset management, and the RFP process in the video below.

Jack spoke with David Sudeck, a senior partner in the JMBM Global Hospitality Group®, as part of our video interview series on hotel finance and investment opportunities in 2015.

A transcript follows the video.

Jack Westergom discusses hotel operating agreements, asset management and cycles - Meet the Money®

David Sudeck: I’m David Sudeck. I’m a senior attorney with Global Hospitality Group® at Jeffer Mangels Butler & Mitchell. We’re here at the 25th Annual Meet the Money® Conference. I’m here with Jack Westergom, Managing Director of Manhattan Hospitality Advisors. Welcome.

Jack Westergom: Thank you. CONTINUE READING →

Contact Information
Jim Butler, Chairman
Global Hospitality Group®
Jeffer Mangels Butler & Mitchell LLP
(310) 201-3526 • jbutler@jmbm.com
www.HotelLawyer.com

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