André Balazs Properties, one of the world’s most acclaimed hospitality companies, has named Savills Hospitality Group to represent them in identifying a partner to support the company’s growth both domestically and overseas.
André Balazs Properties develops and manages luxury hotels such as The Mercer hotel in SoHo, New York, Chateau Marmont in Los Angeles, and Sunset Beach in Shelter Island, New York.
The company also looks after the affordable boutique brand, The Standard, which has five properties in cities including New York, Miami and Los Angeles.
It is partnering with Savills under an exclusive assignment as part of an aggressive global expansion strategy.
The Savills Hospitality team is mounting a global initiative to attract equity investment that will help grow the company’s brands internationally, and also help acquire sites and forge new partnerships in major international markets, adding a new generation to the company’s well-known portfolio of properties.
Savills Hospitality executives said the campaign is targeting the spectrum of investor prospects, including sovereign wealth funds, private equity firms, high-net-worth individuals, family offices and other investment entities in order to see that André Balazs Properties accrues a strong global presence in international gateway cities.
The Savills Hospitality Team is mobilizing its international network to support the program, with a particular emphasis on Savills investment team leaders in the United States, the UK and Singapore.
“The Savills Hospitality team is excited to work with André Balazs Properties on such a significant and highly sought-after assignment,” said Justin Magazine, a vice president with Savills based in the company’s New York City office.
“Our boutique, high-end, international client-based advisory firm is strategically focused on mandates such as this.”
“The André Balazs Properties brand is so well recognized internationally, we expect to generate keen interest from all types of international investors,” said Rob Seabrook, head of Hotel Transactions for Savills’ London Office.
According to Jones Lang LaSalle’s annual Hotel Investment Outlook report worldwide hotel deal volume will reach $32 billion in 2013, as increased transparency around the world gives way to a more globalized arena for investors. A strong bench of buyer groups will remain interested in hospitality assets, with private equity and REITs dominating purchasing activity with 60 percent of the global market, according to the report.
Of the active players, private equity investors will continue to lead the pack, being in the favorable position of achieving opportunistic returns through their significant buying power and risk tolerance. REITs, net buyers throughout 2012, will continue to make headline acquisitions of core properties in gateway markets.This is particularly true in North America and Asia Pacific where two new hotel REITs in Singapore have been listed. Funds from the Middle East will continue to scour the globe for trophy assets looking for opportunities to export capital in 2013.Hotel operating fundamentals are generally holding strong, and in some cases are outperforming expectations, given the economic pressures, says the JLL report.At the forefront of growth in revenue per available room (RevPAR) in 2013 are the world’s gateway and resource-rich cities, which underscore the attractiveness high-quality, income-producing hotel real estate provides as an asset class. Global travellers will boost demand and average room rates in markets such as Istanbul, Munich, San Francisco, Boston, Sydney and Singapore, which have already enticed investor interest and will be the markets to watch in 2013.