Hotel & Motel Management - June 2, 2008 - (Page 38)

38 Special Report NYU INVESTMENT CONFERENCE H&MM June 2, 2008 | HotelMotel.com www.HotelMotel.com/digital_edition Mixed-use Continued from page 36 can loan the money,” said Marty Collins, president and c.e.o., Gatehouse Capital Corp., Dallas. Mixed-use projects that could possibly get funded this year are those focused on the hotel aspect of the project, are supported by credible brands, and are in the right location, Collins said. Still, lenders are only covering 60 percent to 65 percent of loans for new hotel developments, according to some panelists, and holding the owners liable if the projects are not completed. As a result, some mixed-use projects planned for this year will be delayed. While O’Donnell recognizes that RockResorts and Vail Re- sorts’ 19 hotels and condo-hotel properties are successful, the company is delaying some new developments. “We are be- Ross ing cautious in SONNENSCHEIN this market, but by no means is anything be- Neveloff KRAMER LEVIN Collins GATEHOUSE CAPITAL ing abandoned,” O’Donnell said. THESE DAYS, YOU HEAR A LOT MORE NEGATIVE THAN POSITIVE. BANKRUPTCY. RECESSION. FORECLOSURES. BUT DESPITE ALL THE TALK, WE’VE PROVEN YOU CAN STILL BE SUCCESSFUL IN THE HOSPITALITY INDUSTRY. CHOOSE ROCKBRIDGE AND PERFORM BEYOND EXPECTATIONS—SO YOU DON’T JUST SURVIVE, YOU THRIVE. VISIT THRIVE.ROCKBRIDGECAPITAL.COM AND SEE HOW WE CAN HELP YOU THRIVE IN AN UNSTABLE MARKET. CIRCLE NO. 146 “The mixed-use concept can help you capture as much of the guest dollar as you can.” Collins agrees that mixeduse properties can capture more guest dollars, when set up with the right retail and restaurant components. “Choosing the right mix of brands, hotel, restaurant, spa and grocery store is every bit as tricky as what is the right product,” Collins said. Selecting the right retail brands within a mixed-use project depend on the type of guest in the area, according to Collins. “When we stand on a piece of geography, we look at the customer—usually a more afﬂuent customer—and what they want. What a person in Milwaukee wants is completely different than what a customer in Hollywood would want,” Collins said. The mixed-use projects that likely will be ﬁnanced in the near future will have to have great sponsorship, strong balance sheets, and great brands, according to Ross. “It takes all of those today to get projects ﬁnanced. You’ve got to have a great brand, but that alone is not going to do it: the developer has to bring a signiﬁcant amount of liquidity to the table,” Ross said. Meanwhile, current mixeduse failures, including some condo-hotel bankruptcies, stem from developers not doing their homework on the viability of hotel operations and residences in a particular market. “Many of these deals were never underwritten to work as a hotel; they just had a residential component added to them,” Ross said. While the current soft real-estate market has caused a lot of the problems with the condo market, many condo-hotels were not established for the right reasons. “Condo-hotels were born out of a ﬁnancial solution—[developers] couldn’t get money any other way,” Collins said. The successful projects set up the hotel component to run independently of the residential component, Neveloff said. “Then you have different lenders on different components of the structure. And, you don’t have a bunch of residents telling you how to run a hotel,” he said. hmm@questex.com http://HotelMotel.com http://www.HotelMotel.com/digital_edition http://THRIVE.ROCKBRIDGECAPITAL.COM http://THRIVE.ROCKBRIDGECAPITAL.COM

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Hotel & Motel Management - June 2, 2008 Contents State Programs Help Define Green Hotels AmericInn Boosts its American Presence Questex, The Bench to Host Russia Event Perspective Letter to the Editor Legally Speaking Guest Column Marketing Matters Consultant's Corner Satisfaction Trends On Finance Travel Trends Cornell Insights Energy Star Update Maintenance Doctor Management Trends Trends & Stats Finding Financing Challenges Developers Credit Crunch Still Tops List of Lawyers' Concerns Mixed-use Funding Bleak, Panelists Say Luxury Landscape Keeps Pushing Higher PTACs Events Casegoods Seating Energy Controls and Sensors Pest Control Electronic Locks Transactions Supplier News Timeshare Misconceptions Still Prevalent Awards People Ad/Edit Index Marketplace Classifieds Checking Out

Hotel & Motel Management - June 2, 2008

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