and Equity Financing Sources
|Los Angeles, CA - May 20, 2002 -- Jeffer, Mangels, Butler and Marmaro
(“JMBM”), the law firm with the internationally acclaimed hospitality practice,
held its 12th annual conference on hotel finance in Los Angeles on May
The event, Meet the MoneyTM, drew nearly 400 participants and was hosted by partner Jim Butler, Chairman of JMBM’s Global Hospitality Group, widely recognized as the premier hospitality practice in a full-service law firm. The Group has handled hundreds of transactions around the globe, representing more than $20 billion in sales, financings, developments and acquisitions of hotel, restaurant, and resort projects.
In opening the conference, Butler explained, “This conference is a gateway to hotel finance. Meet the MoneyTM brings together the providers and consumers of capital.”
More than 65 hotel debt and equity financing sources and industry lenders were featured as speakers at the event, including CEOs of the nation’s leading hospitality companies, and representatives from the banks, credit companies, Wall Street firms, life companies, pension funds and mortgage bankers that are most active in debt and equity financing of hotels today.
The four financing panels and six breakout sessions, including the much-anticipated CMBS panel, represented virtually every type of hotel financing from construction lending to joint venture equity funding, and from mezzanine financing to credit enhancements. Moderators for the panels were Wayne Williams, Principal, Williams & Associates; Michael Morris, Managing Director, Banc One Capital Market, Inc.; Stacy Silver, Group Publisher, Hotel Group; Jack Westergom, Managing Director, Manhattan Hospitality Advisors; Larry Shupnick,, Senior VP-Development & Acquisitions, MeriStar Hotels & Resorts, Inc.; Art Buser, Managing Director, Jones Lang LaSalle Hotels; Bill Sipple, Senior VP, HVS Capital Corp; Richard Bosworth, Managing Director, Manhattan Hospitality Advisors; Steve McKenzie, Managing Director, Eastdil Realty, Inc.; Bob Rauch, Managing Director, InterBank Capital Partners; and Bruce Baltin, Senior VP, PKF Consulting.
The debt and equity panels and breakout sessions were enhanced by special presentations from industry leaders. Suzanne Mellen, Managing Director, HVS International, addressed trends and issues in hotel cap rates. Alan Reay, President, Atlas Hospitality Group, discussed his firm’s 2001 year-end California sales survey. Mark Lomanno, CEO, Smith Travel Research, presented up-to-the-minute information on the state of the lodging industry, and Steve Rushmore, President, HVS International, presented data and analysis on hotel values after 9/11.
Panelists generally agreed the industry is still suffering from wariness
about the current and future state of the hotel marketplace among buyers,
sellers and financiers alike, despite the recent advent of generally encouraging
numbers. One panelist commented that despite the cautious and conservative
mindset guiding the hands of lenders, the times today are really not so
difficult for capital sources, particularly those involved in the mezzanine
end of the business. Another panelist hoisted the hopes of potential
borrowers in the audience when he relayed the incredibly high rates attached
to mezzanine loans are bound to come down in the very near future, if for
no other reason than there are now a glut of such lenders out there and
the principles of competition will doubtlessly come into play.
The panel addressed some of the most provocative issues, including the greatest challenges facing their respective companies and the industry as a whole in the next 12 months, and the biggest changes in their sources and uses of capital over the past 12 months, as well as the role and importance of frequent stay programs. Sharon Lemon, President, Zest Communications, conveyed the initial findings and conclusions of the JMBM Lender Survey, which indicated that borrowers are challenged, lenders are choosy, creative funding is the order of the day, and because the industry has obviously “weathered the storm,” some 85% of lenders polled reveal they expect to see more hotel loans underwritten going forward.
Culminating the day’s events was the Dealmakers’ Forum and Reception, an informal exchange of the hoteliers and financiers present, sponsored by Chicago Title Company.
Jeffer, Mangels, Butler & Marmaro LLP
2121 Avenue of the Stars, 10th Fl., Los Angeles, CA 90067
One Sansome Street, 12th Fl., San Francisco, CA 94104
James R. Butler, Jr.
|Also See||Outlook 2002: A Roundtable Discussion / The Global Hospitality Advisor / JMBM / January 2002|