Articles Posted in Outlook and Trends

Published on: January 29, 2007

Two deals that may change the lodging world forever.

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
28 January 2007
Hotel Lawyer on hotel finance. History is being made. The biggest leveraged buy out ever keeps getting bigger. Sam Zell has orchestrated an auction for his Equity Office Properties. And the latest bid from the Blackstone Group is $54 per share, bringing the deal value to $38.3 billion and topping the prior bid from Vornado.

At the same time, one of the biggest hotel deals in history — perhaps small change compared to the Equity Office Properties deal but very significant in its own way — has been announced with the $6.6 billion acquisition of CNL Hotels & Resorts by Morgan Stanley and the contemporaneous spin off of $2.4 billion of hotel assets to Ashford Hospitality Trust Inc.

How could these two transactions affect the lodging world, and what is the impact beyond the immediate transactions themselves?

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Published on: January 8, 2007

Hospitality Lawyer — The plays to make successful international hotel investments

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
8 January 2007
Hospitality Lawyer on international hotel investments. In a number of recent postings on www.HotelLawBlog.com, I have focused on the attractiveness of international hotel investments and some of the big names pouring investment overseas. Some of the hot markets include Mexico, Costa Rica, the Caribbean, Spain, Italy, London, Saudi Arabia, Dubai, China and India. In Why we’re building hotels in India like crazy, I focused entirely on India, an explosive market that has often been overshadowed by opportunities in China. In announcing plans for Starwood Capital to invest a half billion in India alone, Barry Sternlicht says that there is so much demand that he is targeting an average annual return of 20% on investments in India!

With all the exciting potential for hotel development in these booming markets, it is tempting for developers and investors to rush in to “scoop up the profits”. But before they do, it would be wise to remember that risk is usually commensurate with reward. At the very least, they should ask: “What is the best way to make successful foreign hotel investments?” Here are a few thoughts from www.HotelLawBlog.com . . .

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Published on: January 7, 2007

How will you finance your hotel project in 2007? Part II

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
7 January 2007
Hospitality Lawyer on hotel finance in 2007. We recently featured our annual expert panel talking about “How will you finance your hotel project in 2007?” Today, I am delighted to present the thoughts of Patrick O’Neal, one of the industry’s’ real lender icons, whether in workouts or CMBS loan production. Patrick has been a great friend and client for more years that either of us probably care to count, but I have always found Patrick’s thoughts, to be unnervingly candid, full of humor and remarkably “spot on” in terms of their accuracy. PNC Real Estate Finance and the hotel world are very lucky to have him! So what does Patrick have to add to the perspectives we have just enjoyed?

For all of our www.HotelLawBlog.com readers, and those who would like to meet Patrick — and our other leading hotel industry capital providers — you will want to join us for the 17th annual Meet the Money® conference on May 3, 2007 in Los Angeles. Sign up now.

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Published on: January 4, 2007

Hospitality Lawyer — How will you finance your hotel project in 2007? Part I

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
4 January 2007
Hospitality Lawyer on hotel finance in 2007. Debt and equity financing of hotels and hotel mixed-use projects is critical and can be very challenging. Our clients take hotel financing seriously, and so do we. That’s why we host the annual JMBM Industry Outlook Roundtable every January and our Meet the Money® conference every May.

With the legacy of Meet the Money® propelling us forward, I was delighted to join with leading hotel industry experts for JMBM’s “Outlook 2007, Hospitality Roundtable.” They reflected on a very interesting year just passed and pulled out their crystal balls to see what would happen in 2007. I am pleased to share their take on what’s going on with hotel finance with the readers of www.HotelLawBlog.com. Some of it might surprise you.

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Published on: January 3, 2007

Hotel Lawyer — Top Picks for 2006

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
3 January 2007
Hotel Lawyer — Top Picks of 2006. Yes, 2006 has been a record year for many in the hospitality industry, and for the hotel lawyers at Jeffer, Mangels, Butler & Marmaro LLP. As we have already given our Outlook for 2007, we thought it might be interesting to look back on our Top Pick articles from 2006 from www.HotelLawBlog.com.

The Top Picks articles are organized by the major TOPICS on the Blog. We generally tried to select just the top two or three articles for each TOPIC. It was a major struggle to decide where to make the cutoff. If you want more information on a particular TOPIC, you can go to www.HotelLawBlog.com, and search for all articles on that TOPIC. To do that, just scroll down the right hand side, and below the (free) subscription and RSS Feed buttons is the Browse search engine that enables you to sort by TOPIC (or date, or key words, etc.).

Here they are . . .

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Published on: December 27, 2006

Hotel Lawyer — What do the InterContinental takeover rumors mean? Why IHG? Why now? Who will win the bid?

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
27 December 2006
Hotel Lawyer on international hotel investment. Over the past two days, the shares of InterContinental Hotels Group Plc — which describes itself as “the world’s biggest lodging company” — rose substantially, fueling speculation that it has become a takeover target. The shares are up approximately 8% since December 22, 2006 (and 49% for 2006). Citing the Guardian, Bloomberg says there are rumors of a buyout firm making an offer at a “significant premium” to current stock prices. Some think a ₤5.7 billion (U.S.$11.2 billion) offer may be made.

Who are the likely buyers? Aside from the financial aspects of the takeover, what does the interest in InterContinental mean? How does this play into the big push into international hotel investments I have been talking about on www.HotelLawBlog.com in some of the most recent postings? Or into the power of brands, or the rush to hotel-enhanced mixed-use development?

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Published on: December 26, 2006

Hospitality Lawyer — Why we’re building hotels in India like crazy!

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
26 December 2006
Hospitality Lawyer India. In a number of articles on www.HotelLawBlog.com, I have talked about the exploding international hotel markets, including Mexico, Costa Rica, the Caribbean, Spain, Italy, London Saudi Arabia, Dubai and China — but particularly INDIA. Why are we building hotels in India? Why are all of the brands and operators trying to stake out territory in India?

It’s not hard to figure out. On December 23, 2006, the Los Angeles Times ran an article by Henry Chu that summed it up pretty well. The headline read: “India, a boom that’s bursting at the seams.” The explosive growth in India is what has everyone scrambling to feed this hungry market.

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Published on: December 12, 2006

Hospitality Lawyer on hotel brands — How far will the pendulum swing? What’s in a name? Just ask Starwood, Hilton . . . Coca-Cola or Procter & Gamble

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
12 December 2006
Hospitality Lawyer on the power of hotel brands. A rose by any other name may smell as sweet. But does a Trump by any other name sell out as fast? Does a Four Seasons by any other name get a $3.7 billion bid from Bill Gates and the Prince?

What’s a brand? It is not always so easy to determine. Yesterday, I talked about how Donald Trump is more than “just” a very successful developer. He has developed a powerful BRAND with legs.” But are all brands the same? Should they be? What makes a successful brand — for an owner or developer?

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Published on: December 11, 2006

Hospitality Lawyer Baja Mexico — So what’s a brand? How did Trump get into this conversation?

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
11 December 2006
Hospitality Lawyer Baja Mexico. He’s done it again if you believe the AP Wire reports. On Saturday, December 9, 2007, the Associated Press reported that, “Donald Trump’s new luxury hotel-condominiums on Mexico’s booming Baja California coast registered about $122 million in sales Friday, potentially heralding a resurgent development boom along the Pacific shoreline, just south of the U.S. border.”

I’ve noted in prior postings that Baja is red hot, and that Trump has become a brand. So what is noteworthy about this latest development?

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Published on: December 6, 2006

Hospitality Lawyer on hotel mixed-use development projects in China, India, Mexico, the Caribbean, Guam — What the experts say now.

By Jim Butler and the Global Hospitality Group®

Author of www.HotelLawBlog.com
6 December 2006
Hospitality Lawyer: In my last posting on www.HotelLawBlog.com, I described “what is fanning the condo hotel wild fire in Latin America, the Caribbean, Europe, China, India and the Middle East.” But condo hotels are only a small segment of the hotel-enhanced mixed-use projects being developed at an rapid pace on the international scene.

The hospitality experts that joined me for JMBM’s “Outlook 2007, Hospitality Roundtable” had plenty to say about the hot international markets, and I am delighted to share their insights with the readers of www.HotelLawBlog.com. You should also see a up-to-the-minute news item related to this in the blog “Hospitality Lawyer — Barry Sternlict and Starwood bet on . . . China!”

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Jim Butler

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 JMBM’s Global Hospitality Group® — a team of seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion.
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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 seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. 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 seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. 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.

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 seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. 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 a Partner in JMBM's Real Estate Department and a senior member of JMBM’s Global Hospitality Group® -- a team of seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. 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 seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. 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 seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. 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.comand select "ADA." For more information, please contact Marty Orlick at 415.984.9667 or morlick@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 an experienced trial attorney and represents management in all facets of labor and employment law, including wage/hour class actions, claims of discrimination, harassment, wrongful termination, trade secrets and unfair competition, union/management relations and workplace violence. He is a member of JMBM's Global Hospitality Group(r), in which capacity he negotiates union contracts and resolves labor disputes throughout the country, defends class action claims, develops strategies for the mass onboarding and separation of employees, and recommends proactive changes to employers' policies and practices in order to minimize potential liability risks. Reach him at 310.785.5387 or tgemoets@jmbm.com.

Mark S. Adams

Mark S. Adams is an experienced trial lawyer and a member of JMBM's Global Hospitality Group® and Chinese Investment Group™. He focuses his practice on business litigation including contracts, corporate and partnership disputes, and hospitality disputes and litigation. On behalf of hotel and resort owners, Mark has successfully litigated the termination of long-term, no-cut, hotel management agreements, franchise agreements, fiduciary duty issues, investor-owner disputes, TOT assessments, and more. He has wide-ranging trial experience in a variety of commercial disputes, including complex multi-party litigation and class actions. He has tried numerous cases in state courts, federal courts, and in domestic and international arbitrations, and is a frequent author and speaker on trial practice. Mark's trial wins have been covered by Forbes, Reuters, and other publications. He has obtained two of California's annual 50 largest jury verdicts in the same year. Mark has taken or defended nearly 1,000 depositions throughout North America, Europe and the Middle East. He has been quoted as an expert on noncompete agreements in the Wall Street Journal. For more information, contact Mark at 949. 623.7230 or markadams@jmbm.com.

Bennett Young

Bennett Young is a partner in JMBM's Bankruptcy, Insolvency and Restructurings Group and a senior member of the Global Hospitality Group® -- a team of seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. His clients include lenders, financial institutions, secured and unsecured creditors, distressed investment funds, businesses, receivers, special servicers and creditors' committees. Ben represented the owner of a partially completed multi-billion dollar resort property in the restructuring of its finances and has represented lenders to hotels and casinos. For more information, contact Ben Young at 415.984.9626 or byoung@jmbm.com

Sheri Bonstelle

Sheri Bonstelle is a partner in JMBM's Government, Land Use, Environment and Energy Department, and a member of JMBM's Global Hospitality Group®. She represents owners and developers in land use, zoning, environmental, litigation and construction matters. She manages all aspects of the entitlement process, including representing clients before local and state agencies, commissions and councils. Sheri also represents clients in a variety of land use and real estate litigation matters in state and federal courts, including cases arising under CEQA and other environmental laws. Her hotel experience includes handling the adaptive reuse of an historic office building as a luxury boutique hotel. For more information, please contact Sheri Bonstelle at 310.712.6847 or SBonstelle@jmbm.com.

Kevin McDonnell

Kevin McDonnell is a partner in JMBM's Government, Land Use, Environment and Energy Department, and a member of JMBM's Global Hospitality Group®. Kevin represents developers and owners of hotels in a broad range of land use and zoning issues including entitlements, code enforcement, easements and parking requirements, as well as related Parcel Map and Tract Map subdivision issues. His hospitality experience includes hotels, condo-hotels and mixed-use projects. A registered Civil Engineer and Structural Engineer in California, and a former building official for the City of Los Angeles, Kevin brings unique experience and insight in Zoning and Building Code applications and Code Enforcement issues. For more information, please contact Kevin McDonnell at 310.201.3590 or kkm@jmbm.com.

Jamie Ogden

Jamie Ogden is a tax lawyer at Jeffer Mangels Butler & Mitchell LLP. He advises individuals and businesses on a range of tax planning, tax controversy and estate planning matters. Jamie’s experience includes all tax aspects with respect to the hospitality industry, including acquisitions and dispositions (including Section 1031 exchanges), financing and management agreements. He also serves as lead tax counsel on M&A transactions, financing, internal corporate restructurings and deferred compensation matters. Jamie also works frequently with litigators on the tax aspects of litigation, judgments and settlements. Jamie has extensive experience with foreign compliance matters, including each variation of the IRS amnesty programs. In addition to his experience in private practice, Jamie also brings several years of service from both state and federal government. For more information, contact Jamie at JOgden@jmbm.com or 310.201.3510.

Wei Deng

Wei Deng is General Counsel of Bosen American Capital, Inc. where in addition to his legal duties, he is responsible for sourcing, evaluating and proposing United States investment opportunities to the company. Wei was previously with JMBM, where he focused on transactional and litigation matters.

Jay Thompson

Jay Thompson has extensive experience representing private companies, business owners, family offices and investors in mergers and acquisitions, private equity and venture capital transactions and private securities offerings. Jay serves as general counsel to many of his clients, their management, and board of directors, helping to shape and execute their business strategies, facilitate growth and liquidity, as well as to advise them on day-to-day legal and other strategic issues. He is known for his practical approach to business issues. Contact Jay at JThompson@jmbm.com or 949.623.7258

Marianne Martin

Marianne Martin has nearly fifteen years of experience advising clients on a variety of commercial, financing, bankruptcy, restructuring and M&A matters, with a particular niche dealing with distressed and/or turnaround situations. Her clients frequently include private equity and hedge funds, independent sponsors, family offices, public and private corporations, financial institutions and banks, healthcare-related companies, municipalities and venture capital funds. She has represented clients in various capacities, including as borrowers/debtors, lenders, acquirers, and agents/trustees in negotiating and documenting complex commercial transactions, out-of-court restructuring transactions and advising on purchasing considerations in secondary market debt transactions. Contact Marianne at MMartin@jmbm.com or 310.201.3531

Trevor Countryman

Trevor Countryman is an associate in the firm's Real Estate Department. He advises clients in all aspects of real estate transactions including property acquisitions and dispositions, financing, leasing, development and construction. Trevor's clients range from large funds to individual developers and opportunistic investors, engaged in deals involving office, retail, multi-family, single-family, mixed-use and hotel properties. Contact Trevor Countryman at 310.201.3546 or TCountryman@jmbm.com.

Vanessa Han

Vanessa Han is an associate in JMBM's Corporate group. Vanessa can be reached at VHan@jmbm.com or 310.785.5383

Vince Farhat

Vince Farhat is Chair of JMBM's White Collar Defense and Investigations practice. Vince has extensive jury trial experience and focuses his practice on representing companies and individuals in criminal and civil investigations and prosecutions by government enforcement agencies, as well as complex federal litigation. He also advises companies in connection with complex and sensitive internal investigations. Prior to joining JMBM, Vince served as an assistant United States attorney in the Major Frauds Section of the U.S. Attorney's Office for the Central District of California. Contact Vince Farhat at 310.785.5382 or VFarhat@jmbm.com.

Sarah G. Hartman

Sarah G. Hartman is a partner in JMBM's Litigation Group and a member of JMBM's Global Hospitality Group® -- a team of seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. Sarah is an experienced litigator who advises and represents clients through all aspects of litigation, from inception through trial and appeal. She advises and represents clients in the hospitality industry, including the termination of hotel management agreements and franchise agreements. Sarah also advises and represents clients on women's health technology issues, intellectual property matters, and complex commercial disputes, including breach of fiduciary duty, fraud, breach of contract, unfair competition, products liability, employment litigation, class action defense, false advertising and other complex financial disputes. Contact Sarah Hartman at 949.623.7243 or SGHartman@jmbm.com.

Michael H. Strub, Jr.

Michael H. Strub, Jr. is a partner in JMBM's Litigation Group and a member of JMBM's Global Hospitality Group® -- a team of seasoned professionals who have helped clients around the world with more than 4,700 hospitality properties worth more than $125 billion. He is a highly skilled trial and appellate attorney who has handled high-stakes, complex commercial and business cases for 30 years including disputes arising out of hotel construction, lending, and bankruptcy. In addition, he has represented plaintiffs and defendants in business and commercial disputes in a variety of areas. Contact Michael H. Strub, Jr. at 949.623.7233 or MStrub@jmbm.com.

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.