(To read more on the debt and equity markets, click here.)

DES MOINES-Principal Real Estate Investors, the real estate investment arm of Principal Global Investors, is launching a new hotel investment potential. Until now, the company's primary focus has been industrial warehouses, retail, office and multifamily property sectors.

Steve Graves, managing director of real estate operations for Principal, tells GlobeSt.com that the move has less to do with the recent flurry of hotel transactions and more to do with client demand. "Were not getting into it because it's a really attractive thing to do right now; this is more of a long-term strategic move," Graves tells GlobeSt.com.

CEO Pat Halter adds that with demand for quality real estate exceeding supply in the traditional sectors, the company needing to find new investment alternatives for its clients. "The hotel sector has been offering investors good current yields and strong long-term internal rates of return, and we're excited about the ability to offer our clients a whole new array of attractive investments," he says.

Although Graves could not speculate on how much the company would be investing into the hotel market, he says it will be substantial. Graves also declined to say where the company would be investing. "I don't want to say 'we have this amount to spend on hotels,' he says. "We just want to make good deals, what ever that amounts to."

To spearhead its entry into the hotel investment sector, the company has hired hotel investment veteran James E. Fitzgerald, who joins as managing director, hotel investments. Formerly with REH Capital Partners, Fitzgerald will develop and oversee all of the company's equity investment and debt financing activities in the hotel sector.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM Digital Member, you’ll receive:

  • Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

National