Hotel Equity Investment Criteria - We Invest in Hotels & Developments
Hotel Building Parameters
- 85 to 350+ room full-service properties
- Minimum $10MM gross revenue
- Prefer>50 SF meeting space per room
- Could include golf, fitness, spa, condo management, F&B, etc.
Boutique Hotels, Upscale and luxury buildings and improvements 3 to 5 Star
London UK, Jerusalem & Tel Aviv Israel, New York City, West Hollywood Ca, Los Angele California, Chicago, Berlin, Toronto, San Francisco, Washington DC and South Beach Miami FL,
Other Market Criteria
Prefer markets with convenient primary or regional airport service; reasonable barriers to entry; diversified demand generators; and multiple demand segments in corporate, group, and leisure.
Prefer fee simple land but will consider longer-term economic leaseholds (>60 – 100 years)
$10 Million to $150+ Million individual assets. Portfolios will also be pursued.
Both current income and value-added projects including, Hotel Renovation, Hotel Repositioning, and Hotel management efforts.
Hotel Development upside and major redevelopment potential will also be considered with assets that can continue to produce interim cash flows.
Prefer unencumbered projects or those in which management can be terminated during investment period.
Will consider primary franchise affiliations if market driven.
Targeted Investment Returns
- Leveraging Return 17% – 20% (60-65% LTV)
- Minimum 12-14% un-leveraged return
- Low initial yields are acceptable where appropriate
Replacement Cost Threshold
Purchase price below replacement cost (<95%).