News for the Hospitality Executive
Concord Hospitality Forming a $300 million Discretionary
Equity Fund to Focus on Acquiring Distressed Hotels
RALEIGH-DURHAM, N.C., Oct. 5, 2009 - Concord Hospitality Enterprises, one of the nation's top-ranked hotel developer/owner/operators, today announced that it has entered the initial stage of forming a $300 million discretionary private equity fund. The fund, which will focus on acquiring distressed hotels and debt, is expected to close within the next 90 days.
Additionally, the company said it continues to aggressively expand its development and third-party management growth. Year-to-date, Concord has developed and opened 9 properties and entered into one joint venture partnership. The company expects to open or sign management contracts for at least three additional properties by year end.
"In 2007, we sold a 19-hotel portfolio that gave our investor partners and us more than $500 million to expand and enhance our portfolio," said Mark G. Laport, president and CEO of Concord Hospitality. "During the course of the last two years, we've leveraged that capital to develop 16 new hotels, of which 13 are open with the remainder scheduled to open later this year and in 2010.
"The fund will allow us to continue our plan to double the size of our portfolio within the next few years, despite the recession," he said. "We believe there will be attractive acquisition opportunities for both hotels and hotel debt, and we expect to be a significant player in those markets."
Laport noted that the company also has dramatically expanded its third-party management and today operates more than 30 properties, or about half of its portfolio, for other owners. "We are expanding into the Southwest, Southeast and Mid-Atlantic regions, as well as Canada," he commented. "We also now are quite active in the upper upscale and resort segments. Our portfolio is now in more than 14 states and two Canadian provinces, and includes branded properties as well as independent hotels and resorts. This geographic, brand and segment diversification gives us greater strength and stability in all phases of the economic cycle."
Concord recently signed management contracts for the independent 88-room Ocean Sands resort in Pompano Beach, Fla., the company's first foray into the resort sector, and a Starwood property in Houston, which is the company's first Starwood Hotels & Resorts flag. Concord has been an approved Starwood management company for two years. It is also approved to operate Marriott, Hilton, Choice, Hyatt and Intercontinental Hotels.
"The Ocean Sands and the Brook Hollow are both key additions for Concord," said Grant L. Sabroff, Concord's senior vice president of business development. "We're diversifying our portfolio to apply our expertise to new brands and segments. These properties will further demonstrate the breadth and depth of our expertise."
Concord's 2009 growth-to-date includes:
Concord Hospitality Enterprises Company, an award-winning hotel management and development company based in Raleigh-Durham, N.C., manages 57 hotels with more than 7,000 guest rooms in 14 states and two Canadian providences. The company operates under such well-known industry elite brands as Marriott, Hilton, and Choice Hotels, is an approved franchisee for Hyatt and Starwood, and also operates an independent boutique hotel. Formed in 1985, Concord was recently listed as one of the top management companies in the nation by independent sources, and recently won Marriott's elite Partnership Circle award for the sixth time. Concord properties are some of the most awarded hotels in the country, having won nearly 30 honors in the past two years alone, including Marriott's Hotel of the Year and Developer of the Year awards. For more information, visit http://www.concordhotels.com/.