News
HOSPITALITY TARGETS NEW YORK
May 11, 2011
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| Yesterday at our Hotel Investment Summit in DC, Hersha Hospitality Trust president and industry icon Neil Shah (with big shots Ackman-Ziff's Mark Owens, moderator Nelson Migdal from Greenberg Traurig, Apple REIT president Justin Knight, Crestline Hotels' Ed Hoganson, and Mesa West Capital principal Raphael Fishbach) said his company wants to be in markets like NY, where it can expect 8% to 10% cumulative average revenue growth over a five-year timeframe. Justin says there's opportunity in refinancing first tranche loans coming due this year, although it's key to evaluate them on an asset by asset basis. Buying notes is an effective way to enter a property with equity and low leverage, Raphael says, and financing is available for the right debt deal. |
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| Allied Advisors' Richard Rudd (second from the left, with moderator Kimberly Wachen from Arent Fox, Pebblebrook Hotel Trust CFO Ray Martz, LaSalle Hotel Properties president Mike Barnello, Walker & Dunlop's Andrew Coleman, and LW Hospitality Advisors CEO Dan Lesser) says there'll be a dramatic increase in CMBS-sponsored hotel acquisitions and refinancings this year. (CMBS accounted for 31% of hotel financings last year, and they'll do about $7B this year.) Dan has seen increased interest from foreign investors in key US markets like DC and NY, which are cheap compared to some international deals going for $2M/key. |
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| Over 450 packed the Capital Hilton. Ray says REITs have the upper hand when shopping for hotels because they've got more liquidity than private investors (it won't change 'til LTVs get to the true 65% to 70% range, he says). He also expects more distressed opportunities from CMBS servicers this year and next. A hotel can lose value fast when people hear it's in trouble, so special servicers will want to act quickly. |
