Ameri-First, Homegate Aggressively Acquiring 100 Hotels in 17 States

Two Dallas-based operations – Homegate Hotels and Ameri-First Financial Group Inc. – will jointly acquire 100 hotels of varying brands in 17 states by year’s end in a dual-pronged strategy that pumps hard assets into the financial service and cements the hotel operator’s presence nationwide.

About three hotels, with an average of 250 rooms each, are being bought each week, James Chatham, Ameri-First vice president, told GlobeSt.com. The aggressive acquisition strategy got under way in March, with Homegate securing a five-year renewable management contract for the properties.

In concert with the acquisitions, both companies are beefing up internally to keep pace with the development program, which will put at least 15,000 rooms at a purchase cost of $35,000 to $45,000 per room into the portfolio, says Charles Wilkerson, vice president of acquisitions for Homegate, which is operated by his sons and son-in-law. In three weeks, the privately held Homegate will assume corporation status and be publicly traded while Ameri-First has sealed a letter of intent with Hampton Securities to open brokerage offices in Los Angeles, West Palm Beach and New York City, according to the executives. Ameri-First also is buying Gap Insurance Co., a vehicle leasing business, Chatham says, predicting the business strategies now in play will double per share value for Ameri-First stock within 30 days. It presently is trading at $1.50 per share, down from its $2.57 per share book value due to last February’s merger with Tahoe Pacific. Ameri-First expects to realize $120 million to $150 million in equity and a net operating cash flow of $28 million to $30 million by the Homegate teaming, which adds a real estate subsidiary and hard assets to Ameri-First’s bread and butter of cash-flow financing, emphasizes Chatham.