The most recent transaction is a 69-key Comfort Suite in Seaford, DE, with a development cost of $6.5 million. A last minute contract for the firm signed within the last few weeks, Marshall is now rushing to help get it open by the first or second week of June.
Two of the contracts are in the Baltimore area: a 130-room Indigo Hotel and a 100-suite Staybridge Suites. Historical renovations, their development costs are between $20 million each, according to Marshall.
Marshall has also contracted to open a 126-suite Summerfield by Hyatt in Norfolk, VA, and a 126-room, ocean-front Hampton Inn in Virginia Beach. The Norfolk project is a mixed-use development with costs expected to range between $75 million to $85 million. Development costs for the Hampton project, which includes 24 condos, are projected to be $30 million, Marshall says.
The firm has herded a number of hotel construction projects to completion before taking on management of the properties. Between 2005 and 2006 it opened five hotels, Marshall notes. This recent batch of contracts matches that number. This is a cyclical activity, he goes on to note, very dependent on the status of the larger hotel cycle. "Five or six years ago, for instance, we managed a number of similar projects."
In the current hotel cycle--with new supply gaining traction and the asset class beginning to slightly soften--pre-opening management has become more critical, Marshall says, citing figures that show a strategic pre-opening plan helping a hotel to ramp up as much as 50% faster than the 60 or so days typical of many companies.
The deals are also noteworthy to Marshall in that three of the brands will be new to its portfolio: Hotel Indigo, Staybridge Suites and Hyatt Summerfield Suites.
Hotel Indigo, a recently introduced boutique hotel brand by InterContinental Hotels Group, is located at 207 East Redwood St. The conversion of the historic Keyser Building will be complete by Q2 2008 and will be Baltimore's first Hotel Indigo.
The Staybridge property will convert the Jefferson Building into an extended-stay, all-suite hotel by Q4 2007.
The Summerfield Suites by Hyatt-Fort Norfolk will be part of a mixed development that also includes retail space and medical offices. It is expected to open in 2008.
The Hampton Inn Oceanfront, located between 10th and 11th streets, will open in 2008. It will be the city's first Hampton on the beach.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
