961 East Main Street Spartanburg, South Carolina 29302 Phone Number: 864-327-4030 Fax: 864-596-8934
During our team’s 15+ years in the hospitality business, we have built, owned and operated over 500 hotels across the country. The current lack of capital, combined with challenging market conditions, has altered the dynamics of the hotel business. We see the current challenges within the hospitality sector as an opportunity to selectively increase our portfolio through the acquisition of attractively priced hotel assets. As with most other real estate segments, the hospitality sector is highly cyclical. We believe valuations are currently at or near their nadir and sector performance and hotel asset values will increase in the future. Additionally, we are actively purchasing hospitality related debt from financial institutions allowing them to recapitalize and reduce their exposure to real estate. Investment opportunities in this area include individual whole loans, CMBS and portfolio dispositions. We have remained well capitalized allowing us to take full advantage of this opportunity.
Our chief investors, Wayne Huizenga, George Dean Johnson, Jr. and Dean Buntrock, are world-class entrepreneurs and as such, recognize the opportunity today to create wealth through the acquisition of hotel loans and assets. With their financial backing and business acumen, we are approaching this new business model with the same commitment that we have demonstrated in our past pursuits. Our investors participate through a series of funds, Palmetto Hospitality Fund I, II and III. These funds provide the equity to develop and acquire hospitality assets and are the ownership entities. We will employ, where appropriate, the use of leverage to enhance returns.
While we prefer Marriott, Hilton, Starwood and Hyatt select-service hotels located in strong markets, we will consider any hotels that could be conversion candidates to these brands or that have a solid competitive position in their respective market. Our team also has experience in the full-service sector and will consider attractive investments for inclusion in our portfolio. Historically, OTO Development has concentrated our efforts in Washington, DC, California, NY/NJ and Florida and most of our initial acquisition efforts have been in these markets; however, we will evaluate quality projects in other markets. In addition to feasibility underwriting and financial modeling, our platform allows us to manage construction and renovation projects and to provide top-quality property operations allowing our team to thrive through all phases of the lodging cycle.
Our talent and expertise in the hospitality sector include a full compliment of services. We have architects, engineers, lawyers and financial experts on staff. Additionally, we have construction and development personnel based in most of the major markets where we have previously developed properties. These resources can be leveraged to bring expert underwriting and analysis to bear when reviewing hospitality opportunities.
Our current portfolio includes 34 hotels with all but two being self managed by our internal management group. Our operating team has broad and deep experiences and provides valuable input when evaluating opportunities.
OTO Development recently purchased the whole loan on the Hampton Inn and Suites Ybor City/Tampa. Upon first learning about this opportunity on June 26, we immediately deployed personnel to Tampa to study the market and evaluate the hotel. We underwrote the deal, submitted the winning bid on July 7 and closed on the loan on July 10- just fifteen days from start to closing.
Our team’s extensive knowledge of the hotel industry allows us to quickly and effectively underwrite any U.S. market. When combined with our ample capital resources, OTO Development can close transactions rapidly providing increased investment flexibility and a smooth, stress-free process for the seller.
If you are a hotel owner, lender or associated party and are interested in discussing disposition or recapitalization options, please contact us to learn more about this opportunity.
Todd Turner Vice President – Real Estate tturner@otodevelopment.com (864) 327-4033