Since that time it appears B.R Guest has taken a step back from the property as the restaurant has been renamed “Beachwood BBQ & Grill” instead of B.R Guest’s Wildwood BBQ & Grill that it was originally named as, there is almost no mention of Postcard Inn on B.R Guest’s website except for an RFP page that is pretty hidden and it is listed on Hersha Hospitality Management’s website as one of their managed properties.

I came across an article in the Miami Herald that talked about the Holiday Isle resort property, located in the Florida Keys, that was foreclosed upon by Starwood Capital in 2009. Starwood in conjunction with Hersha Hospitality Management put the property under a $10 million renovation over the summer and has finished the first part of the renovation – renaming it Postcard Inn Beach Resort and Marina, including opening a Shula’s burger (oddly – not a B.R Guest restaurant) and keeping it in the same design class as the original Postcard Inn in St Pete’s beach, including the lower price point.

From the tone of the article as well as the content of the website – the renovation is not 100% completed yet, hence the quiet release of the website and new brand name, but according to the article the new hotel will “open” in December 2011.

So could this be a new Starwood Capital brand that has slipped in under the radar? Can this brand be replicated in non-beachy locations? We’ll have to see, but it’s an interesting development to see another Postcard Inn.

andrew@alconic-inc.com

There is no information on branding of the property – which is of special interest to those who follow Starwood Capital & Barry Sternlicht – so no word on if it will be a “Sternlicht inspired” hotel (eg – 1Hotel or Baccarat),or if it will be a Hyatt or other established brand. But they did have a picture, and some basic facts – 340,000 sq ft, 120 key 5-star hotel, and another 140,000 sqft of residential with hotel amenities.

It’s difficult to tell just by the appearance of the building – but it does show a few elements which could be unique – an outside pool deck area mid-building and a grassy/tree-filled terrace on the upper third of the building as well.

Starwood Capital’s Other NYC Hotel Projects

HotelNewsNow.com reported that Barry Sternlicht recently stated that he has three hotel projects currently on the drawing board in NYC: The Donnell/Tribeca Associates project mentioned above, the conversion of 1414 Ave of the Americas, and another unannounced project that he’s keeping close to the vest. Once again, there is no word or indication as to the brands of these hotels – will they be Starwood Capital brands, or will they be branded with other well established luxury brands?

I’m thinking that these projects will be some type of new or unique brand to Starwood Capital because typically they will not make a big deal in the press or market about “just another hotel transaction”. I’m sure we’ll find out one way or another over the next few months.

andrew@alconic-inc.com

I suggest anyone who is interested in Starwood Capital or Barry take a read at it.

Renaissance Man: As Starwood Capital Turns 20, Founder Barry Sternlicht Explores New Paths

Some quotes I found interesting

On Starwood’s investment in Hersha Hospitality Management:

The investment in Hersha Hospitality Management raises Starwood’s profile in hotel management. Its SH Group affilate manages the Baccarat brand and is developing four properties in the Middle East and four in China. Starwood’s investment in Hersha will help that company expand its management portfolio from about 80 properties today to as many as 200 in the next three to five years, Shah said. That growth will come from third-party management agreements, from hotels owned by Starwood funds and from managing hotels acquired by Hersha Hospitality Trust. In approaching such deals, Sternlicht takes the role of a visionary, who masters details without getting lost in them, Shah observed. “He’s a very demanding executive of his team as well as of his investors and his partners.”

On Starwood’s creation of Starwood Property Trust

Starwood Property Trust also marked Sternlicht’s return to the public markets after his departure from Starwood Hotels in 2005. In its mission, however, Starwood Property more closely resembles iStar Financial, the publicly traded investment banking firm that Sternlicht founded in 1998 and chaired until divesting Starwood’s interest in the company five years later.

I always knew that Starwood Property Trust was somewhat modeled on iStar Financial.

Lastly, it’s interesting to me that Sternlicht has some of the same interests as me:

The hotel business, meanwhile, had proven to be tailor-made for Sternlicht’s wide-ranging interests in capital markets, operations, marketing and design

andrew@alconic-inc.com

Why would they do that?

What company would not want to join up with a highly reputable competitor, plus put some money in their pocket? Have better opportunities due to the association, more money to do transactions with and just go to the next level of the business?

Starwood Property Trust was presenting an unconditional offer for the entire company as long as they did not go through with the share dilution they were about to price the next day. In fact, Starwood was even willing to go through with the pending purchase of mortgage assets from Barclay Capital Real Estate as long as they had 5 days to review the documents. So now Crexus stockholders are burdened with a share price that is lower than it was on Monday.

Honestly, I wouldn’t be surprised if the Barclay Capital Real Estate portfolio was also being pursued by Starwood Property Trust, who lost out on it to Crexus. Starwood then thought it may make sense to just purchase the acquirer, and then along with Crexus’ assets, they’ll get the Barclay assets as well. How else would Starwood be able to do due dilligance on the Barclay porfolio – $528 million dollars worth – in as little as 5 days if they were not already pretty familiar with it?

Whenever takeover attempts fail, the company being taken over always has a rough road ahead of it – it has to perform a little better than it ever did before or else investors and partners will sit back and think – “They really should have sold to such and such” and end up being a much smaller and less powerful company. I hope for Crexus’ sake that doesn’t happen, their stock offering is successful and the Barclays transaction goes through without a hitch – or else Starwood (or another company) may take another stab at Crexus and win, but this time on the cheap.

What do you think? Should Crexus have taken the buyout offer? Will they be able to pull off everything? Let me know your thoughts in the comments or via email.

andrew@alconic-inc.com

Today, according to a press release from Orient-Express, it isn’t Starwood Hotels – but Starwood Capital which is taking over development of the project into a “World-Class Hotel”. So it is still possible it may be a Starwood Hotels branded hotel, I’m crossing my fingers it may be something from Starwood Capital’s hotel portfolio instead.

The press release states that Starwood Capital & Tribeca Associates

..will assume all the terms and obligations of the original contract made between Orient-Express Hotels and the New York Public Library, including the reimbursement of all previous payments made by Orient-Express Hotels and the assumption of all future payments.

After some research into the original announcement and development proposal by Orient-Express back in 2007, the project was described as this:

The five-story building on West 53rd Street will be razed to make way for an 11-story hotel, but the library will own and occupy space on the first floor and underground under the terms of the deal, the two sides said. Five floors of the hotel will connect to the “21” Club on 52nd Street, also owned by Orient-Express.

With:

150 rooms costing $750 to $2,000 per night and a restaurant on the top floor.

The hotel was originally going to be called “21″ based on Orient-Express’s “21 Club” but with the new ownership group, its doubtful it will be a 21, although there still is a chance it may connect to the 21 Club.

I’m eager to see what Starwood Capital chooses to brand this site, as well as a their other recent purchase of 1414 Ave of the Americas only 5 blocks North.

andrew@alconic-inc.com

In the last few hours my email inbox has been bombarded with news that Barry Sternlicht’s Starwood Capital has purchased 1414 Ave of the Americas in Manhattan for a conversion into a hotel. This is pretty exciting news because its one of the first purchases that Starwood has made in years on a property to be converted or built from scratch in the lodging industry. I’m not going to sit here and claim that hospitality development is finally on the upswing because of this purchase; but I will say that Starwood Capital would not have moved on this property if there was not the potential of a huge upside. Purchasing a 110,000 sqft 18 story, almost 100 year old building, one block from Central Park in mid-town Manhattan for $72 million is a pretty darn good deal.

1414 Ave of the Americas is a pretty low-key building, for years it was used as office space and ground floor retail, although in 2009 it made the news when Ian Schrager was looking at it for one of his hotels (prior to Edition). Unfortunately at the time the owner lost the property when the mortgage was sold and Schrager’s project never got off the ground.

The building was even originally built as a hotel – and apparently KISS had outdoor concerts on the rooftop years ago, although I cant seem to find any information as to when the place was last a hotel – the earliest article I could find about the property was from 1992 when SL Green first purchased it and converted it from a “shoe building” (catered mainly to the footwear industry) into regular professional office space.. And professional office space its been since then, although now it is almost completely vacant – making it ready for an immediate renovation.

There already has been some speculation that Schrager may be involved with this new purchase – but I find that highly unlikely.. It would be a huge reversal for Sternlicht as his name will bring the same (and probably even more) cachet to any hotel project.. Barry may not have “invented” the boutique hotel industry – but he definitely did popularize it and make it mainstream.

So what could the future hold for 1414 Ave of the Americas? Its tough to say.. Will Starwood & Sternlicht team up with Hyatt or Starwood Hotels or even use his brands from Groupe Du Louvre (Golden Tulip) or perhaps some other large luxury hotel brand? Or will this finally be the beginning of a long line of hotels from the SH Group which never really got off the ground after the economic shakedown of the past few years..

Ah – this news will have my heart pumping fast tonight!

andrew@alconic-inc.com

Here is Hilton’s Statement

In the lawsuit, originally filed in mid-2008, Starwood accused Hilton of stealing thousands of confidential documents and material which had information on how to create, brand and operate a boutique/lifestyle hotel brand. At the time, Hilton had wooed two Starwood Executives, and essentially their entire support staff and in a matter of months created the Denizen hotel brand. The support staff and executives had intimate knowledge of Starwood’s W hotel brand.

Starwood was sure to win this case from the beginning – starting with the drop shipment of thousands of propriary Starwood documents to Starwood’s corporate headquarters with a note from Hilton’s lawyers stating in essence “we found these in our possession, and thought they should be sent back to you”.

In the aftermath of the lawsuit, Hilton’s boutique/lifestyle brand – Denizen – was completely cancelled, and their entire luxury development team fired, it went right up to the top with Steve Goldman stepping down from Hilton.

The settlement between Starwood & Hilton has been detailed as containing the following three items

1. A moratorium on Hilton working on the development/planning/creation of any lifestyle brand until January 2013
2. A cash sum payment to Starwood, the amount of  which was not detailed
3. The supervision of Hilton by federally appointed monitors to ensure Hilton will be abiding by these rules.

In addition, it mentioned that the Federal Grand Jury investigation is still continuing and this settlement has nothing to do with that investigation. According to the Wall Street Journal, Hilton has been told it should not expect charges to be filed against it in the investigation; I think the settlement with Starwood should push that investigation to a close and will probably result in no action since Starwood seems to be satisfied with the results.

There was really no doubt in my mind that the case would end this way – it was just a matter of how long it would be until Hilton could develop a boutique/lifestyle brand, and how much Hilton would have to pay Starwood. I still wonder what it has done to the careers of Amar Lavlani and Ross Klein.. Are they ever to be employed by a major corporation again? It’s a sad story because I knew both of them, and have met them a few times, so I’m still a little suprised that they did what they did – but I think it comes down to this: money talks.

andrew@alconic-inc.com

Not much has been said about the property or the project – in fact the former Renaissance has been closed and deserted since 2007 leading to speculation as to what will go there.

Last week, with Hyatt Hotels, Starwood Capital announced that they will be starting a joint venture to open an Andaz Resort & Residences on the property, it’s due to open in the fourth quarter of 2012.

The Former Renaissance Wailea

Starwood Capital already has a number of Hyatt Hotels in their portfolio, off the top of my head I know they own the Hyatt Regency New Orleans, and one in Chicago as well, so dealing with Global Hyatt isn’t exactly something new to them (I’m sure some will find that hard to believe!) In fact, this joint venture is a very good deal for Starwood Capital.

According to their press release, Hyatt will be contributing around $90 million for the renovation and improvements for the property, and the press release didn’t mention it, but Starwood’s biggest expense will most likely just be the land and it’s existing buildings. That’s a HUGE discount from the initial capital expense Starwood would have had to incur for the construction of the Baccarat hotel; not only would they have to tear down the existing buildings, but Baccarat required a completely different site plan and appearance than exists on the current site. Plus, even though Andaz isn’t a W or Baccarat or other Barry Sternlicht creation – the Andaz brand does have the design and architecture ethos that is typical for a Sternlicht creation.

I’ll be interested to see how the property ends up looking – all the Andaz’s so far have not disappointed in appearance and unique style, I’m sure this one won’t disappoint either.

andrew@alconic-inc.com

My friends over at VegasChatter seem to think this could be the first Barry Sternlicht-ing of Vegas since the days he used to operate CaesarsWorld in the 90s. I’m not so convinced.

Sure, Sternlicht and Starwood have been involved with trying to take over the Riveria for years now.. Just do a Google search for Rig Acquisitions Sternlicht and you’ll see what I mean. But there is something else that Sternlicht sees in the property – it can’t be the building, its small compared to the rest of the Vegas casinos, its not in the ‘heart’ of the Strip – in fact its almost in no-man’s land compared to CityCenter and other ‘it’ casinos; its surrounded by the unfinished shells of Echelon Place & the Fontainebleau and casinos of yesteryear like the Las Vegas Hilton & Circus Circus.

It could very well be that Sternlicht sees the potential in the site come, 10 – 20 years when projects like Echelons Place or The Plaza ever get off the ground (if they ever do that is!)

Or.

Sternlicht could just see a good deal.. after all, the Riveria has been on its last legs for a few years now – before any economic downturn even started, and buying a mortgage for 50 cents on the dollar, well.. that’s just a good investment, and that’s really what Starwood Capital is all about.

andrew@alconic-inc.com

Not too many details have been released about this transaction – including the cost of the transaction – but both companies claim that Starwood will contribute both capital and deals to Hersha Hospitality Management.

Starwood’s purchase of just less than a controlling interest gives them easy access to a great hotel management company – enabling them to not have to staff up and create the SH Group as a leading management company from scratch, it also provides Hersha, a private company, with some capital as well as great management opportunities that Starwood Capital is privy to due to its own investments.

HHM specializes in select-services brands – as that makes up almost 75% of their portfolio – although in the press release its stated that HHM and Starwood will look for both select and full-service contracts. It’s interesting to note that Barry Sternlicht has said in the past that the opportunities in lodging at this point are more in the mid-scale/select services vs high-end luxury. Most of HHM’s properties are branded by the majors – IHG, Marriott, Hilton and Starwood, but lately they have been managing more independent boutique hotels, especially in New York City.

It’s hard to say exactly what this transaction means for Starwood Capital’s own SH Group, 1 Hotels & Baccarat Hotel brands, but its obvious that this will benefit both Starwood & HHM by providing each party with a service that they need. One change I can see this transaction enabling HHM to do is cast a wider net increasing their geographic service area – currently HMM manages properties encompassed within the triangle which goes from Boston, MA, to Virgina to Pennsylvania.

Today was the first day of the Annual NYU International Hospitality Industry Investment Conference, so this could be the first of a few good deals that are announced, and hopefully more details will be provided.

andrew@alconic-inc.com