W. Edward Walter

David Loeb, a senior real estate research analyst and managing director for Milwaukee-based Robert W. Baird & Co., credits Greg Larson, Host's new executive vice president of corporate strategy and fund management, with forging the international drive. In a report issued yesterday, Loeb says the new pool is structured similar to the $1.5-billion Euro-JV, which includes Netherlands-based Stichting Pensioenfonds ABP and targets high single-digit internal rates of return. Host's equity contribution to both pools hovers $300 million. In return, Host will earn asset management fees, typically 1% of invested assets, and could get more through an incentive promote. The new fund has a three-year investment shelf life.

Host did not return telephone calls by deadline to comment on the JV. But, Loeb says the partners most likely will invest in upscale hotels at 60% to 70% leverage. GIC must approve Host's 25% stake in any acquisition. The leverage bumps the JV's buying power to $1.5 billion to $2 billion.

Loeb