Hotel Acquisition and Development
Two Bridges Capital has secured a GP capital investor relationship with the 8th largest Hospitality company in the world with over 1,300 flagged hotels and a 96% member retention rate. This fully vertical company has launched new flags in the luxury, full and select service space with plans to expand from 30 to 300 hotels by 2020.
Corporately, and in partnership with Two Bridges Capital, the Hospitality company will build or acquire 30 institutional quality, flagship, full service hotels and select service inns in the next 3-5 years with an expected $600 - $700 million total project costs. GP Capital required will be between $30-$40 million over this time period. Two Bridges Capital is assisting the company in securing senior, mezzanine and/or LP financing. Project level levered IRR targets exceed 25%.
Our partner currently has contracts to acquire or develop hotels (1000+ rooms) in Florida (Jacksonville, Miami and Ft. Lauderdale) and Moab Utah with aggregate project costs of $125 million. Additional sites in Florida, North Carolina, Texas, California, Las Vegas, and New York City are under negotiation or being pursued.
NYC Institutional Self Storage Development
Two Bridges Capital has secured a GP capital investor relationship with an unmatched Self Storage team who has developed more than 40 facilities in the NYC area over the past 15 years. The company strategy is to build and manage 25 institutional quality Self Storage properties totaling over $400 million in project costs. GP capital requirement is $35 million over this time period. Two Bridges is assisting the company in securing senior, mezzanine and/or LP financing for this program. Project costs of $250/sq ft compared to most recent sales exceeding $600/sq ft result in expected 2 - 2.5x project multiples.
Two facilities are currently under construction and an LP investor has been selected for an additional 4 projects totaling $70 million in project cost. The company has identified an additional 16 "as of right" sites in the NYC area for future development. Metrics remain extremely favorable for the sector; the overwhelming consensus in the market is that demand for storage will far outstrip the availability of suitable developable land.