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Hotel Financing looking at a new benchmark — The $100 billion deal.

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25 April 2007
Hotel Lawyer on hotel financing summit. As more than 120 providers of capital — debt and equity capital for hotels — prepare to head to Los Angeles for the ultimate face-to-face summit with consumers of hotel capital in Los Angeles on May 3, 2007 at JMBM’s Meet the Money® Conference (for details, see , a fitting benchmark has been surpassed. The $100 billion deal is now “on the table” and may be about to happen!


I talked about it earlier here on when it still seemed unthinkable, and that was only January of this year. See Two deals that may change the lodging world forever and Size no longer matters . . . at least in the hotel industry. Is the entire hotel industry now in play?

In these postings, I mused that the new ability of the private equity guys to raise virtually unlimited amounts of capital suggests that even a $100 billion deal is possible, and noting that the entire capitalization of the hotel industry is less than the Equity Office deal completed earlier this year.

Well today, the Wall Street Journal has a breaking story that a consortium of banks led by Royal Bank of Scotland Group PLC has made an offer to buy ABN Amro Holding for 76 billion euros (or $103 billion), outbidding Barclay’s 64.9 billion euro offer. This deal does not involve any hotels, but raising capital is something a commodity business — it does not matter what the capital is for; the capital raising machine has surpassed all the old limits. Anything could be next.
What does this portend?

These are certainly exciting times. Hotel financing is about as readily available as it is likely to get, for big deals or small ones, for new development or refinancing of exiting product. That will be the entire focus at our Gateway to Hotel Finance in Los Angeles next week on May 3, 2007 at the Sheraton LAX. Whether you are a provider of capital or a consumer of capital — a hotel lender or a hotel borrower — if you can’t hook up with the right people next week, something must be wrong. Because next Thursday is time for Meet the Money® 2007. Hope to see you there.

Our Perspective. We represent developers, owners and lenders. We have helped our clients as business and legal advisors on more than $87 billion of hotel transactions, involving more than 3,900 properties all over the world. For more information, please contact Jim Butler at or 310.201.3526.

Jim Butler is one of the top hotel lawyers in the world. GOOGLE “hotel lawyer” or “hotel mixed-use” or “condo hotel lawyer” and you will see why.

Jim devotes 100% of his practice to hospitality, representing hotel owners, developers and lenders. Jim leads JMBM’s Global Hospitality Group® — a team of 50 seasoned professionals with more than $87 billion of hotel transactional experience, involving more than 3,900 properties located around the globe. In the last 5 years alone, Jim and his team have assisted clients with more than 90 hotel mixed-use projects, all of which have involved at least some residential, and many have also involved significant spa, restaurant, retail, office, sports, and entertainment components — frequently integrated with energizing lifestyle elements.

Jim and his team are more than “just” great hotel lawyers. They are also hospitality consultants and business advisors. They are deal makers. They can help find the right operator or capital provider. They know who to call and how to reach them. They are a major gateway of hotel finance, facilitating the flow of capital with their legal skill, hospitality industry knowledge and ability to find the right “fit” for all parts of the capital stack. Because they are part of the very fabric of the hotel industry, they are able to help clients identify key business goals, assemble the right team, strategize the approach to optimize value and then get the deal done.

Jim is frequently quoted as an expert on hotel issues by national and industry publications such as The New York Times, The Wall Street Journal, Los Angeles Times, Forbes, BusinessWeek, and Hotel Business. A frequent author and speaker, Jim’s books, articles and many expert panel presentations cover topics reflecting his practice, including hotel and hotel-mixed use investment and development, negotiating, re-negotiating or terminating hotel management agreements, acquisition and sale of hospitality properties, hotel finance, complex joint venture and entity structure matters, workouts, as well as many operating and strategic issues.

Jim Butler is a Founding Partner of Jeffer, Mangels, Butler & Marmaro LLP and he is Chairman of the firm’s Global Hospitality Group®. If you would like to discuss any hospitality or condo hotel matters, Jim would like to hear from you. Contact him at or 310.201.3526. For his views on current industry issues, visit

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