Atlas in the news

Los Angeles Business Journal 09/29/17 Labor Works Against Hotel? HOSPITALITY: Westin sale may reflect union pull in LB. By Caroline Anderson http://labusinessjournal.com/news/2017/sep/29/labor-works-against-hotel-hospitality/   The recent deal for a Long Beach hotel below its last sale price could be a sign of tangible effects that labor action is having on the Long Beach hotel market, analysts said. The $88.1 million deal for the Westin Long Beach, one of the city’s four major convention center hotels, follows efforts in recent years to unionize workers and control operations in the increasingly important hospitality industry in this waterfront community. The city’s political climate has encouraged labor advocates, whose tactics have impacted the Westin and other businesses, said Randy Gordon, chief executive of the Long Beach Area Chamber of Commerce. “They found a stronghold in Long Beach because not every city has pro-union council members,” Gordon said. “(There were) marches at 6 a.m. banging drums with signs saying, ‘Don’t stay here.’ We lost a lot of conventions along the way. They’ve upset people.” The 469-room Westin was sold in August for $88.4 million, about $300,000 less than what it went for more than a decade ago, according to CoStar. The lower price came in spite…

Los Angeles Business Journal 07/28/17 New Financial District Hotels Drive State Record Three properties add 1,465 rooms, nearly one-third of six-month total. By Jerry Sullivan http://labusinessjournal.com/news/2017/jul/28/wilshire-grand-hotels-drive-state-record/ Downtown’s Financial District accounted for nearly one-third of the number of hotel rooms added to the industry’s inventory statewide in the first half of the year, thanks to a pair of high-profile entries and the arrival of a traditional boutique. The InterContinental Hotel led all projects in the state when its 889 rooms debuted with the opening last month of the Wilshire Grand Center. The hotel partially occupies the 73-story tower, the tallest building west of the Mississippi River, at Wilshire Boulevard and Figueroa Street. The Hotel Indigo added 350 rooms a few blocks away on Ninth and Francisco streets, and the boutique Freehand Los Angeles accounted for 226 rooms at Eighth and Olive streets. Those three combined for 1,465 new rooms and drove a statewide record of 4,730 for the first half of 2017, according to Alan Reay, president of Irvine-based Atlas Hospitality Group, which provided the data in its recent midyear survey. Reay said the biggest batch of new hotel rooms over a six-month period prior to this year’s burst was 2,502…

Los Angeles Business Journal 07/28/17 Modular Wall Maker Puts Together Fund Emagispace raises $4.2 million to help product grow beyond use on film, television productions. By Shwanika Narayan http://labusinessjournal.com/news/2017/jul/28/modular-wall-maker-fund-manufacturing/ Downtown-based Emagispace Inc. has raised $4.2 million in a Series A funding round intended to grow its product line of modular walls that can be assembled into various interior structures. Its emagiblock is a singular interlocking unit that comes in different sizes for wall and space customization that the company initially targeted for use on film and television sets and is now expanding into uses such as retail displays and trade-show booths. The mid-July round was led by Santa Monica-based investment firm Alpha Edison. Other participants included New York technology fund Circle Ventures; Jeremy Zimmer, chief executive of Beverly Hills’ United Talent Agency; and New York-based real estate private equity firm 54 Madison, among others. Privately held Emagispace was co-founded in 2015 by brothers Noel, 49, and Clark Maxam, 55. The younger Maxam is an Emmy Award-winning producer, director and writer who’s worked in daytime television for more than 20 years, including on shows such as “Days of Our Lives” and “The Young and the Restless.” He said he started toying…

The Orange County Register 10/03/17 Southern California Hotels Find Filling Rooms Tricky By Jonathan Lansner http://www.ocregister.com/2017/10/03/southern-california-hotels-find-filling-rooms-tricky/   Is the local hotel industry too eager to expand? Southern California hotels appeared to be struggling with a growing supply of empty rooms this summer. In August, for example, all five local markets tracked by CBRE Hotels had dips in occupancy rates vs. a year ago, while room rates fell in Los Angeles and Orange County compared with 2016. Local hotel owners have added competition this year amid an industry building surge. Additionally, hotels may be paying a price for increasing room rates and making visitors rethink their lodging plans. Year to date, all five Southern California markets had higher average room rates vs. the first eight months of 2016 but only two markets — Palm Springs and San Diego — filled a higher share of rooms in 2017. Here’s how local markets have fared, year-to-date through August vs. 2016’s results for the same period for average room rates and occupancy, according to CBRE Hotels data … Los Angeles: Averaged $211 a night, up $1 in a year; 84 percent full vs. 85.4 percent a year ago. Orange County: $191 — up $5;…

HotelNewsNow 09/27/17 Bump in California Hotel Sales Shows Strength of Market By Bryan Wroten http://www.hotelnewsnow.com/Articles/241548/Bump-in-California-hotel-sales-shows-strength-of-market   REPORT FROM THE U.S.—California remains an active hotel investment market in 2017, and data from Jones Lang LaSalle shows more hotel investment in the state during the first eight months of the year than there was during the same period in 2016. The state saw $2.9 billion in hotel trading through August, said JLL EVP James Stockdale, while for the same period in 2016, that number was just under $2 billion. “That proves there’s still a number of folks trying to buy hotels and who still see them as a good investment,” he said. That statement seems to be further justified by the results of Atlas Hospitality Group’s 2017 Midyear California Hotel Sales Survey, which showed the state reported a new midyear record in hotel sales, as the number of transactions reached 206, exceeding the 187 sales closed in the first half of 2014. Alan Reay, president of Atlas Hospitality Group, said his company’s survey had some surprising results. “We were all looking at the market taking a breather,” he said. “Interest rates were going up; people were perhaps pulling back and taking a…

Los Angeles Times 09/24/17 Is Disney Paying Its Share in Anaheim? The money battle outside the Happiest Place on Earth By Daniel Miller http://www.latimes.com/projects/la-fi-disney-anaheim-deals   A few hours after the gates swing open at Disneyland and Disney California Adventure, the cars are still pouring into the massive 10,241-space parking garage. They zoom into the six-story concrete structure, carloads of costumed kids, foreign tourists and graying baby boomers sporting Mickey Mouse ears, “Frozen” dresses and “Star Wars” backpacks… …Last year, Disney sought a tax rebate for a proposed hotel at its resort. Under a program started in 2015 to encourage the development of four-diamond properties, Anaheim offered hoteliers a 70% refund on the 15% bed tax collected from guests for 20 years. Without the incentive, Disney said it would not build the 700-room hotel, The Times reported last year. Still, Alan Reay, president of Atlas Hospitality Group, a real estate firm that specializes in hotels, says it would be hard for Disney “to argue that they wouldn’t build that hotel without subsidies,” given the company’s financial position and the strong economy. A city-commissioned study said that the new Disney hotel would create 5,050 construction jobs during the course of the project…

The Registry 08/30/17 Hospitality Market in California Retains Its Shine By Michele Chandler http://news.theregistrysf.com/hospitality-market-california-retains-shine   Hotel sales surged in California during the first half of the year, according to a recent industry report. A shortage of strong alternative investment opportunities and attractive terms are fueling a spike of first-time investors in California hotels, including investors from as far away as China, according to the Atlas Hospitality Group’s 2017 Mid-Year California Hotel Sales Survey. While the median sale price per room “has pulled back slightly from 2016,” the report said, “there is no let-up in buyer interest.” Statewide, the average cost per room went down nearly 3.5 percent, to $151,266, while the median price per room decreased 3.1 percent, to $103,586. “What we’re finding across the board is a lot more transactions, but a lot more of the lesser-priced transactions than what we saw for the first six months of 2016,” including fewer high-end, or “trophy,” hotel sales, said Atlas President Alan Reay. But California also saw a record 206 individual hotel transactions through the first six months of year, according to the report. The previous high of 187 transactions was set in 2014. The mid-year total dollar volume of $3.23…

Building Design + Construction 08/25/17 Hotels Savor Demand in Northern California’s Wine Country By John Caulfield https://www.bdcnetwork.com/hotels-savor-demand-northern-californias-wine-country The Wine Institute estimates that nearly 24 million people visit the 4,653 wineries in California’s wine regions each year. That tourism’s economic impact in the state, which last year totaled $57.6 billion, includes a robust hospitality and lodging market. While construction slowed a bit last year, there were 26 hotels with 2,204 rooms in the planning stages for northern California’s vineyard-rich Sonoma County, and 13 hotels with 1,621 rooms being planned for Napa Valley, according Atlas Hospitality Group’s 2016 California Hotel Development Survey. Earlier this month, construction began on one of those establishments, the $24 million, 122-key Hotel Trio in Healdsburg, Calif., which CU Investors, its developer, expects to open next April. The 82,638-sf hotel, situated in the Sonoma wine country, will serve the Dry Creek, Russian River, and Alexander Valley areas (hence, the “trio”). It will be within walking distance of a host of wineries and have convenient access to hundreds more within a 30-mile radius of the site. The hotel will include 13 one-bedrooms and 109 studios, and primarily will target individuals and couples who are staying over for a few…

Orange County Business Journal 08/17/17 Hotel Construction Mostly Small World for Meetings Properties Coming Soon for Smaller, Local Clients By Paul Hughes https://www.ocbj.com/news/2017/aug/14/hotel-construction-mostly-small-world-meetings   Local data show at least eight Orange County hotel projects are under way, several that are scheduled to open in the next six months, and most notable for something they’ll have in smaller amounts than just about any property in OC: meeting space. Most construction (see box below) is limited or “select service” hotels, smaller offerings by design, with fewer bellhops and whistles—complimentary breakfast and a couple of thousand square feet for events. Industrywide, “the vast majority of new hotels being built are in the smaller, limited service sector,” said Alan X. Reay, president of Irvine-based consultant and broker Atlas Hotels. Atlas produces a report reflecting current hotel construction. “The average size of these properties is 100 to 150 rooms, and you’re not going to build lots of meeting space,” he said. “You don’t have the capacity.” Reay said such hotels are easier for developers to finance and more profitable for owners to operate, producing profit margins of 35% to 50%, compared with 15% to 20% at full-service hotels with several hundred rooms and the full…

Bisnow 08/15/17 San Diego Hotel Transactions Up 70% in First Half of 2017 By Patricia Kirk https://www.bisnow.com/san-diego/news/hotel/san-diego-hotel-transactions-up-70-in-first-half-of-2017-77702   Hotel transactions in San Diego County increased in the first six months of 2017, up 70% from previous midyear sales. The total sales dollar value rose 54%, according to a midyear hotel sales report from Atlas Hospitality Group. The average price per room rose 2% compared to hotel transactions during the first half of 2016, but the median price per room dropped 6%. The sale of the Park Hyatt Aviara Resort Hotel in Carlsbad to lender CW Capital Asset Management was the largest and most expensive hotel transaction at $185.6M, the report noted. That transaction came after a years-long struggle by the previous owners to repay debt coming due, the San Diego Union-Tribune reports, which noted a grant deed in lieu of foreclosure transferred the property to the lender for the amount of unpaid debt. Broadreach Capital Partners paid $251M in 2007 for controlling interest in the 329-room hotel, which was formerly managed by Four Seasons. Overall, there were 206 hotel transactions in California through the first six months of 2017, a midyear record. The previous midyear high was in 2014, when…

The San Diego Union-Tribune 08/15/17 SoCal Hotel Sales Reach New Record By Lori Weisberg http://www.sandiegouniontribune.com/business/tourism/sd-fi-hote-sales-20170815-story.html In a surprise turnaround, Southern California hotels sales rose sharply during the first half of the year, reversing a downward trend for all of 2016, reported Irvine-based Atlas Hospitality Group. The mid-year report reveals a record number of transactions for the state as a whole — 206 — and a total dollar volume of $3.2 billion, the second highest on record, according to Atlas. In Southern California, there were a record 97 transactions, valued at $1.99 billion. That falls short of the previous high of $2.4 billion, set in mid-2015, although it is considerably higher than the $1.1 billion in sales for the first half of 2016, Atlas reported. “At the end of 2016 we definitely saw a slowdown and we had projected the number of sales would either be down or flat because we thought interest rates would be going up, and we had a new administration, and almost the complete opposite happened,” said Atlas president Alan Reay. “Sales have continued to climb, and interest rates are still at historic lows for hotel financing.” Los Angeles County recorded the priciest transaction in the state,…

The Real Deal 08/14/17 LA Hotels Are Trading at Double the Rate They Did Last Year: Report By Katherine Clarke https://therealdeal.com/la/2017/08/14/la-hotels-are-trading-at-double-the-rate-they-did-last-year-report   Los Angeles hotels are trading at twice the rate they did last year, thanks in part to the availability of financing and continued demand among buyers from China. In L.A. County, 26 hotels traded hands during the first six months of the year, the same number as traded during the whole of 2016, according to a report by Atlas Hospitality Group cited by the Los Angeles Business Journal. Those 26 deals accounted for $780 million in total dollar volume, a 46.1 percent increase from the same period last year. The average price was $238,000 per key, a 25.6 percent increase from last year. “I think a lot of smaller players who made it through the recession are now seeing prices being offered that have them thinking that now is a great time to get out,” Atlas president Alan Reay told the Journal. A $219 million deal for the W Hollywood hotel was the priciest deal of the year so far. The 305-key property sold in March to HEI Hotels & Resorts and Gatehouse Capital of Dallas.