When GreenSlate Development committed to revitalizing the Blackstone District near downtown Omaha, … [+] Revitalizing the Cottonwood Hotel was a priority, despite being the company’s first hotel project.

Dana Damewood Photography

The saying “location, location, location” still holds true, but some traditional residential real estate developers are taking it to the next level as pandemic market trends open up new hotel options. Condos, villas, houses and commercial properties fluctuate depending on supply and demand. The pandemic makes hotel investments particularly attractive for some developers.

Many see a hotel as an opportunity to complement and upgrade the residential components of neighborhood projects. Others, often in tropical vacation destinations, may find that demand is far exceeded Offer for vacation properties, even before Covid-19. Either way, hotels represent a new world of challenges that real estate companies may not be used to, such as: B. Average daily rate, occupancy, sales per available room, key figures and personnel problems.

The decision to enter a new investment sector is not made lightly. While most real estate companies that choose a hotel choose to run a hotel, the inherent risk remains. Hotels are companies that are sitting on a real estate investment. You need an industry veteran’s expertise to make them work.

An oceanfront villa in Beach Enclave Grace Bay

Beach enclave

It is common for hotel companies to branch out into real estate, according to Alvaro Acebal, Director of Operations at Beach Enclave in the Turks and Caicos Islands. He cites hotel brands like Ritz-Carlton, St. Regis, and W Hotels that operate units within or adjacent to some hotels. However, Acebal notes that the opposite rarely happens with real estate companies taking their first step into building a hotel.

An April report by The Wall Street Journal pointed to a rebound in hotel investors after a hard blow in 2020 due to the pandemic. In some cases, real estate companies are lured into the opportunity to buy distressed hotels (largely due to the Covid-19 pandemic) and convert them into affordable housing, according to a recent one CNBC report.

Real estate developer Soho Properties, which focuses on residential and commercial properties, will … [+] opens its first hotel this summer, the Margaritaville Resort Times Square.

The McBride Company

While many real estate investment projects began before the coronavirus even got into our daily lexicon, the fate of the industry isn’t entirely bleak. Growth can be market-specific as some officials in cities like New York say they even want to curtail new hotel projects The New York Timeswhile other destinations want to grow.

Tidewater Capital typically focused on mid-sized residential projects and ventured into its first … [+] Hotel project with the Moxy Downtown Oakland. The lobby is decorated with eclectic, youthful furniture that is a trademark of the Moxy brand, owned by Marriott Bonvoy.

Mark Compton

Acebal points out that in many markets, real estate companies turning to the hospitality industry can make a lot of sense. This type of leap of faith cannot just increase success for a hotel property or the bottom line of a real estate company. It can bring energy and demand to areas that once thrived from long term vacation breaks or permanent home ownership. With hotels as anchors, communities can develop and thrive. Here are some of the new hotels that are the result of residential real estate investors trying it out.

Kimpton Cottonwood Hotel, Omaha, Nebraska

The Blackstone District

The property developers took great pride in restoring as much of this hotel’s legacy as possible … [+] possible. Many locals contacted the hotel to donate antiques and memorabilia from the hotel’s past to the exhibition.

Dana Damewood Photography

As Matt Dwyer, director of GreenSlate developmentwho began to invest in Blackstone District A few years ago the mood in the city was rather optimistic. The once somewhat neglected area is on the edge of the inner city core, and the coordinated connection of the inner city with the many medical centers on the other side made sense.

Today the Blackstone District is teeming with chic boutiques, yoga studios, cafes, restaurants, breweries and apartment buildings. In the center of the neighborhood was the old Blackstone Hotel, which had since become an office building. For Dwyer and his colleagues, who had previously only invested in residential properties, it made sense to buy them and convert them into a flagship hotel that is now known as Hotel Kimpton Cottonwood, Part of the InterContinental Hotels Group (IHG).

The real estate investors took great pride in restoring the Schimmel rooftop ballroom … [+] the monument protection of the building. Richard Nixon announced his presidential candidacy here.

Dana Damewood Photography

The more than 100 year old residents fondly remember social events and important events in the hotel. Richard Nixon announced his presidential candidacy in the Schimmel rooftop ballroom, which is now popular for wedding events and has an outdoor terrace and herb garden.

The Cottonwood has been restored to its former glamor, but with plenty of modern decor (including Kimpton freebies like morning coffee, evening wine receptions, and in-room yoga mats) the Cottonwood is pulsating with activity. Even the Committee Chophouse Restaurant and Cottonwood Room Bar attract locals for historical photos of the neighborhood and the hotel’s past.

“We chose to give hospitality an ad hoc focus because the building and its history offered a once in a lifetime opportunity, an iconic hotel in the city we were all born in and the neighborhood we made for everyone worked so hard to restore, ”Dwyer said.

The club in the Beach Enclave Long Bay, Turks and Caicos

Providenciales

The club in Beach Enclave Long Bay, Turks and Caicos Islands, opens next year.

Beach enclave

Beach Enclave’s swanky, multi-bedroom oceanfront villas are located in three different areas of Providenciales, the main island of the Turks and Caicos Islands. Almost 70% of visitors come to the island by private plane for a vacation (or even a vacation) extended stay to work remotely). As the villas, most of which have five bedrooms, must bought as a bundle (and not rented individually) this is the kind of place families or groups of friends travel together to get away from the hustle and bustle of the larger hotels.

A villa in the beach enclave of Grace Bay

Beach enclave

Each villa has a swimming pool surrounded by sun loungers, an outdoor terrace with dining area and barbecue, spacious living areas and a fully equipped kitchen with butler service. A cook can also prepare meals upon request and breakfast is free for all guests.

A villa in the Beach Enclave North Shore

Beach enclave

The cluster of residences is so popular that regulars began asking for more facilities so they could stay overnight on the property, which led to the idea of ​​building a hotel.

While Beach Enclave guests have access to tennis and basketball courts, 24-hour fitness center, and in-room spa services, many wanted more, including being able to socialize outside of the villa.

Traditionally, the Turks and Caicos market has relied on real estate and condominium hotels rather than typical resorts. However, that changes with new hotels like The Ritz-Carlton, Turks and Caicos Opening this summer and a new hotel project, The Club at Beach Enclave Long Bay, with 24 rooms and eight four-bedroom residences with the widest beachfront on the islands next year.

The latter will be the first hotel project for Vasco Borges, the CEO and founder of Beach Enclave. When Borges abandoned his financial career to pursue the private villa resort investment model, he tapped a new interest in hospitality after seeing growing demand from existing customers interested in taking their families on vacation.

The arrivals lobby for The Club at Beach Enclave Long Bay

Beach enclave

Demand for the residences was instantly popular and sold out within months, and a hotel seemed a natural extension. Borges said both models offer a great experience and his company is in discussions with developers in other parts of the Caribbean to bring this model to other beach locations, particularly those with convenient access to “major North American markets”.

The Ray Hotel, Delray Beach, Florida

Delray Beach

Real estate developer Menin is making its first foray into hotel investment with The Ray in Delray … [+] Beach, Florida.

The beam

As Craig Menin, CEO of I walked, a residential and commercial real estate company, opened Delray Beach Market (the largest grocery store in Florida) this year, its plan was simple. He wanted to invest in the further development of the Delray Beach community and help shape its upscale orientation, while at the same time filling a gap in which concepts (such as the Food Hall) did not exist.

“As someone who lives in Delray Beach and travels a lot, I’ve seen the market have a hole,” says Menin.

The Food Hall at Delray Beach Market is the largest in Florida.

Delray Beach Market

The Ray Hotel will be part of that plan when it opens as a member of the Curio Collection by Hilton in September. Menin wants to keep Delray Beach “less dense” and “lower scale”. By moving beyond residential and commercial projects into the hotel sector, the company can advance the design aesthetic and overall direction of the area. With Menin’s extensive experience in property development rather than hotel operations, the company relies on Clique Hospitality to manage the property.

Menin is responsible for much of Delray Beach’s real estate development.

I walked

“We want to preserve the history, beauty and charm of Delray Beach, but also offer opportunities to enhance our urban beach town,” adds Menin.

This is what an anchor hotel project can do for many communities, and today many new hotel real estate companies are taking the reins to make it happen.

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