September 30, 2009
Menlo Park’s GI Partners is allocating some $500M to target the troubled hospitality sector. The company intends on targeting both assets and debt. GI Partners was the basis for what is now Digital Realty Trust.
The hotel sector has been hit extremely hard. The numbers across the board for hotels, whether its occupancy, average daily room rates, or Revenue/Available Room are down across the board from last year, which is down from the year before.
The distress at the asset level, coupled with the sky high prices and convoluted capital stacks that many of these assets were acquired with will provide hotel investors with plenty of opportunities. Some of the higher profile deals we’ve already seen include St. Regis Monarch Beach (default on Citi debt) and the Maui Prince Hotel (Morgan Stanley), W San Diego, etc. etc.
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