BarbriSFCourseDetails

Course Details

This CLE course will discuss key legal issues in structuring hotel joint ventures agreements, taking into account the unique issues in this asset class. The panel will focus on critical topics in an evolving market, including restructuring and the role of rescue capital and will provide best practices for attorneys that advise hotel owners, investors, and industry professionals.

Faculty

Description

In an era marked by economic complexities, the hotel industry faces a unique set of challenges. Higher interest rates, escalating construction costs, stringent brand requirements, fluctuating travel trends and changes in market demographics, particularly the challenges in central business districts, have created a landscape where traditional models of hotel ownership, development and management are no longer sufficient.

Joint ventures offer significant flexibility and can be tailored to the specific circumstances of the transaction and to the needs of the parties. Thus, real estate equity investments and joint ventures have become an increasingly important part of the investment strategy for hotel properties. The joint venture model for hotel acquisitions offers many benefits, including increased access to capital.

In the current market, there is a need for and access to rescue capital in critical situations. When structured properly, joint ventures can serve as a strategic tool to leverage strengths and mitigate risks. However, joint venture agreements and other related documents are very complex and fiercely negotiated. Real estate and finance counsel must understand all the pertinent issues to successfully evaluate and address economic issues when negotiating and structuring these agreements and hotel transactions.

Listen as our authoritative panel of real estate practitioners and advisers reviews vital legal issues in joint ventures for hotel acquisitions and development. The panel will focus on preferred return/promoted interest, carried interest, cash flow splits, risk allocations, guarantees, unwind provisions, and other major decisions.

Outline

  1. Traditional preferred return/promoted interests
  2. Carried interest
  3. Cash flow splits
  4. Risk allocations
  5. Guarantees
  6. Major decisions
  7. Unwind provisions
  8. Restructuring
  9. Rescue capital

Benefits

The panel will review these and other key issues:

  • What are the current economic challenges and their impact on the hotel industry?
  • What are new avenues for sourcing and utilizing rescue capital?
  • What are current trends in the use of joint ventures to provide financing for hotel development and acquisitions?
  • What unique issues in hotel acquisitions impact risk allocation provisions?