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Hotel Lawyers -- featured subjects and articles
Meet the Money® 2014

ADA defense and compliance

EB-5 financing

Workouts, bankruptcies & receiverships

Hotel Management Agreements

Hotel Franchise & License Agreements

Hotel industry trends

This is Jim Butler, author of www.HotelLawBlog.com and hotel lawyer. Please contact me at Jim Butler at jbutler@jmbm.com or 310.201.3526.

Published on:

13 May 2013

Meet the Money® made the news again this year, with an article on the Wall Street Journal “Developments” blog. Written by Kris Hudson, the article discusses the return of hotel construction, what types of financing are available, and which markets will be able to support new hotels.

Meet the Money® speakers Marty Collins of Gatehouse Capital, Anne Hampton of Wells Fargo Bank Hospitality Finance, Alison Cumberland and Abid Gilani of Marriott International, Kevin Mahoney of Stonebridge Companies and Paul Novak at Whitman Peterson Capital Partners were quoted in the story.

Conference speakers highlighted the CMBS market, gateway city locations, and upper-midscale hotels developments as factors that might help push construction financing in 2013, although some noted that lending standards are still strict and that many markets may not have a demand for more rooms.

If you haven’t read the article yet, you can find it here: Lenders Checking In? Hoteliers Say Construction Lending Is Reviving.

You can more great information from Meet the Money® 2013 at www.HotelLawyer.com on our RESOURCE CENTER, under “Hotel Industry Presentations.”

Published on:

www.MeetTheMoney.com
11 May 2013

Meet the Money® is one of the best places in the country for meeting the Who’s Who of the hotel world, getting financing and transactions done and catching up on the latest strategies and approaches. This year’s conference was held at the Sheraton LAX, May 6-8, 2013 and was attended by approximately 350 hotel industry leaders. Here’s a quick take on the mood of the conference and some information about
Mood of the hotel industry: optimism and sustainability of recovery

JMBM wrapped up its 23rd annual hotel conference this week amidst the strongest optimism for the hotel industry that hotel experts have seen for six years. The consensus was there is a lot of blue sky ahead. Some think the good times will only last for a couple of years, but many see a good run for at least 5 years!

Everyone at Meet the Money® seemed to be fairly comfortable that the recovery has significant sustainability, because the debt and equity markets have not gotten too frothy, and new supply has been very restrained.

Mark Woodworth of PKF summarized it well after presenting industry fundamentals by saying: “It is a great time to be in the hotel business!”
And Vail Brown gave the STR forecast that the outlook of continuing improvements is “Steady as she goes.”

Greg Hartmann of JLL sounded a slightly more cautious note. He agrees that everything looks pretty good for the next couple of years, but questions how long it can last, and suggests that investors might consider selling in the next year and a half to two years.

What inning are we in? Almost every panel gave its views, with the biggest consensus being that we are in the 4th or 5th inning — still early in the ballgame. John Alderson of Westfield thinks that the shopping center owners now getting active in adding hotels to their malls are way behind the rest of the industry (2nd inning?) and are likely to have their games continue as they implement strategic plans.

Hotel Industry Presentations from Meet the Money® 2013

Meet the Money® 2013 was buzzing with action and great information. We have decided to release some of the presentations for free download. Select presentations from Meet the Money® 2013 (described below) and are now available at www.HotelLawyer.com. Click on “RESOURCE CENTER” and then “Hotel Industry Presentations.”

CONTINUE READING →

Published on:

Jim Butler and the Global Hospitality Group®

08 May 2013

Lodging Industry Investment Council
Annual Top Ten Survey
Trends And Challenges

Strong hotel property value growth predicted, fueled by increasingly favorable hotel debt — despite overall sluggish economic growth, sequestration, unionization and Obamacare. According to the LIIC 2013 Survey, this is what the hotel industry has in store in 2013.

The Lodging Industry Investment Council (LIIC) is the hotel industry “think tank” whose membership includes the hospitality industry’s most influential investors, lenders, corporate real estate executives, REITs, public hotel companies, brokers and significant lodging equity sources. More than 80% of surveyed LIIC members have purchased a hotel in the last 12 months. Together, the members of LIIC represent ownership, control or disposition of well over $20 billion of lodging real estate.

CONTINUE READING →

Published on:

01 May 2013

Meet the Money® 2013 is next week! Online registration ends this Friday, May 3, 2013 at 5 pm.

It is hard to believe but our 23rd annual Meet the Money® conference is less than a week away — May 6 to 8, 2013 at the Sheraton LAX.

We have an exciting program with the top providers and consumers of debt, equity and other pieces of the capital stack. We also have top industry leaders speaking and attending, plenty of opportunities for networking and deal making, and the best conference food and snacks in the industry.

Hot topics include all the latest on WHO is providing hotel financing and HOW the deals are being done — from small deals to big deals. Presenters are all active in providing capital or finding the best sources of it.

In addition to all the latest on hotel debt and equity, there will be some great panels on:

  • State of the Hotel Industry — industry fundamentals, capital markets,
    financing and market values, cap rates, transaction data and trends,
    state of the economy

    STR
    PKF Consulting
    HVS
    Jones Lang LaSalle
    Atlas Hospitality
    Richard Green, USC Lusk Center

  • Development: What’s Hot — What’s Not
    Where’s the money going for development?
  • EB-5 Update: Financing for New Construction
    Why do the EB-5 apps double each year?
  • Why the ADA matters to you.
    Comply now or pay later
  • CEO Panel: New Strategies for a New Economy
    Are you at the table or on it?
  • Hotel Retail-Mixed-use
    Why are people adding hotels to shopping centers?
  • State of the CMBS Markets
  • Workouts/Receiverships/Takeovers
    Strategies for distressed hotels
  • Maximizing Return & Value
    Branded vs. Independent Operators

And much more!

CONTINUE READING →

Published on:

11 April 2013

Click here for the latest articles on Data Technology, Privacy & Security.

Hotel Lawyer on technology challenges to your proprietary and sensitive corporate information. The continuing advances of technology continue to present a double edged sword. On the one edge are tremendous cost savings, efficiencies and power to manage information. On the other edge are daunting issues of information security and privacy.

In the article below, two of our Global Hospitality Group® lawyers talk about a recent court decision from the respected second circuit in New York that has important implications for every employer in the hospitality industry. It serves as a reminder that good employee handbooks and company policies are important to protecting your valuable business information and electronic data.

Here is what it is all about.

CONTINUE READING →

Published on:

8 April 2013

Click here for the latest articles on ADA Compliance and Defense.

ADA defense lawyer: Striking the right balance

The ADA defense and compliance team at JMBM has long advocated compliance with the Americans with Disabilities Act, commonly known as the ADA. ADA compliance is good business and it is the law. (See articles at www.HotelLawyer.com under HotelLawBlog/ADA Defense & Compliance.)

But we have all seen some terrible abuses of this law in the hands of certain plaintiffs and attorneys who literally file dozens of cases. I have a service that follows the filing of ADA complaints, and recently, one lawyer filed 18 cases in one day against various small businesses for purported ADA violations.

It seems as if both courts and legislatures are getting fed up with abusive practices by some greedy or overzealous advocates. We recently reported on action by the California legislature in “Finally! Relief from abusive ADA litigation in California?“)

Today, we want to recognize a recent federal court decision that reflected outrage at abusive plaintiffs and their lawyers which detract from the spirit and noble purpose of the ADA. We think this kind of insight and approach will help to strike a better balance that we believe was the intent of the ADA.

Today, my partner Marty Orlick provides us with a trenchant summary of the case, including some insightful quotes from the court’s opinion.

CONTINUE READING →

Published on:

1 April 2013

Hotel owners: How the appellate decision in Marriott International v Eden Roc can affect your hotel investment (and why you should understand the law behind the court’s decision)

As we reported in our 27 March 2013 blog, a New York Appellate Division court made it possible for the owners of the Eden Roc Renaissance hotel in Miami Beach to oust Marriott as its operator — despite the long-term hotel management contract between the two, which would have lasted another 43 years. (See “Marriott loses appeal in Eden Roc case: Why all long-term hotel management agreements are now terminable.”)

Setting the stage: owner-operator disputes over hotel management agreements

The relationship between a hotel owner and hotel operator is complex. While the owner bears the financial risk of the hotel’s success or failure and its gain or loss in value, the operator has the exclusive right to manage the owner’s business and is paid “off the top” whether the hotel is profitable or not. The contract between the owner and operator — the hotel management agreement — typically transfers control of the hotel’s assets to the operator.

Hotel owners nationwide are keenly aware of both the benefits and impediments of long term hotel management agreements with branded operators (and nearly all such contracts are long term, often running 40 or 50 years). On the upside, the brand can provide stability, consistent standards, a reservation system, marketing expertise and professional staffing. But the downside can be hard for owners to live with — brands can rigidly incur needless expenses, be unresponsive to market conditions and impervious to the owner’s need to run a profitable business and protect its asset.

While the majority of hotel owners and operators work hard to achieve a balance that is a win-win for both parties, it is easy to understand how things can go badly, fast.

CONTINUE READING →

Published on:

29 March 2013

Hotel Lawyer on branding your hotel or running it as an independent. When should you brand your hotel and when should you leave it unbranded? How do you know when the benefits justify the costs? And if you decide to brand, should you go with brand management or an independent operator? What are the considerations?

Few decisions are more important. Here is hotel lawyer, Robert Braun to share some insights garnered by our Global Hospitality Group®’s experience in helping clients with more than 1,000 hotel management agreements and franchise agreements.


To Brand or Not To Brand
(your hotel)
by
Robert E. Braun | Hotel Lawyer

Why the hotel branding and management decisions are so important

One of the first decisions in the hotel development or acquisition process can have a lasting impact on the success of the project: whether the property should be branded, and whether that brand should manage the property. The hotel’s brand will be a defining part of the profitability, image and value of the hotel, and there may be no other decision which has a greater effect on the future of the property. Similarly, the management of a hotel can enhance the value of the brand, protect the owner, or detract from the value of the hotel — by as much as a 50% swing.

CONTINUE READING →

Published on:

27 March 2013

Hotel Lawyer with a major legal development on terminating hotel management agreements — Marriott v Eden Roc.

Under a New York Appellate Division court decision issued March 26, 2013, virtually all hotel management agreements are now terminable at will by owners. And this result will prevail even against the Marriott-style management agreements that seek to avoid an “agency” characterization of the owner-operator relationship.

The decision was rendered in the case of Marriott International v. Eden Roc reversing the November 7, 2012 decision of Judge Melvin L. Schweitzer, who had granted Marriott’s motion for a preliminary injunction, halting the owner’s ouster of Marriott for poor performance.

In reversing the lower court decision, the Appellate Division succinctly stated that hotel management agreements giving full control to operators are personal services contacts and cannot be enforced by injunction. The court said:

CONTINUE READING →

Published on:

15 March 2013

Great opportunity . . . and danger . . . await shopping center owners who seek to add hotels to their shopping centers, malls and retail centers.

An interesting confluence of factors has ignited a wave of hotel development — adding hotels to shopping centers, malls and retail centers. This trend is already underway and will be headline news for the next couple of years.

There are compelling synergies for both the shopping center and the hotel. These have been thoroughly documented by major players. One major shopping center owner performed a multi-year study on its 200+ properties and found that the right hotel can boost gross sales at shopping centers 20% to 40%. And the associated hotels also get a boost in Revenue Per Available Room (RevPAR) of 30% to 40% over hotels in their competitive set.

If you need more information on the basics — why people are adding hotels to shopping centers and malls — look at the articles posted on www.HotelLawyer.com. From the home page, scroll down and look on the right-hand side for under “Hotel Development” or go to www.hotellaw.jmbm.com/hotel_development.

CONTINUE READING →

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