The ruler is broken. Our foundations of real estate comprehension have been set off balance with the unknown world of today. The struggle for what factors bring a project to stabilization are a challenge for underwriting and a compelling need for mastery to achieve it. Within the specific niche of Hospitality bringing hard assets and operations together, we have new risk profiles that bring a new set of boxes to check.

Today, we do not have a long term time line forward on solidified underlying factors which can be dependable and remain highly volatile. How can we define, control and rationalize through this environment and what does it create for current acquisition, development and repositioning strategies? We must take all the pieces into consideration as we find the pathway to service the needs of tomorrow's traveler, vacationer and remote worker.

The responsibility to develop these answers for the Hospitality segment will also impact the world's needs of new buildings, the way we live in and around them and how our future urban cities will develop in a more environmentally conscious way.

The cornerstone; Municipal Support, and the drive of entrepreneurial innovation is a constant of the human condition that brings solutions. 

Our world continues to experience vast economic turmoil in the hospitality and tourism industry. From ignorance to adaptation, we are still in the middle of so many questions and rapidly materializing solutions. The responsiveness and support that the hospitality industry has both given and received are an amazing testament to the resilience of an industry which is a backbone of our economy.

The longer range problems are fueled without solution in sight today based in a steep decline in Average Daily Rates (ADR), length of stay (LOS) and Occupancy (OCC) revenue indicators for many hotel properties. These properties are in a limbo of when next steps will occur. They need a plan for tomorrow, of being restructured, sold or refinanced with new vision and strategies.

Opportunities are emerging to develop, redevelop, and repurpose Hospitality projects. What is the value proposition for branded or boutique strategies when acquiring distressed hotel properties and how does the geographic location of these assets impact that decision?

Within today’s economic disruption, opportunities are emerging to develop, redevelop, and repurpose Hospitality projects utilizing ready/rescue capital, new strategies and new visions. Devastating occupancy percentages and revenue decreasing ADR and REVPAR have been hit with higher costs of operation and a need for an expertise and capital combined solution for an industry wide problem.

Current operational demands requiring asset repositioning is a reality. Increases in the costs driven by demands of clients, workforce and mandated municipal procedures have brought a demand for compliance that has never been underwritten for. This has caused a major impairment to the entire hospitality and travel industry. This expansive economic dislocation has brought all previous investment strategies within Hospitality projects to a massive unknown. The need for operational expertise, with a finesse of experience and new safety standards are the new pathway for value extraction. These require new capital commitments, timelines dictating a more critical path for the success of each investment decision. We now have a greater timeline with a larger cash requirement to the path of stabilization. It is a moment in Hospitality where dollars that are more needed to solve problems and create ways of unlocking efficiencies. The near term value dislocation as underwriting and costs catch up will be an opportunity for the greatest multiple for investment in the medium to longer term. Because this is not for the simple, the faint of heart or those without know how, it will be a narrow field demanding the most for its returns. It’s unprecedented, it’s important to the life safety factors of this asset class and one that requires a fortitude of being solution focused.

This is the opportunity to bring the combination of capital and capability to the hospitality industry and be a market leader of choice on selected assets in selected markets with the best of class properties having near term needs and longer term outperforming metrics for investment.