LOS ANGELES-Canyon Capital Realty Advisors and its affiliates, including Canyon Johnson Urban Funds, have launched a drive to intensify their hotel investment activities under managing director Richard Bosworth, who joined CCRA 18 months ago. Bosworth, who has over 30 years of experience in the hospitality industry, says that Canyon foresees a high level of activity in the sector for Canyon over the next 24-36 months in markets including New York, Chicago, Southern California and Washington, DC, as well as cities within the Pacific Northwest, the Northeast and the Southwest.
Canyon is “actively evaluating hotel properties that are in need of recapitalization, especially in markets that enjoy a mix of room demand from both commercial and leisure travelers,” Bosworth says. The firm has established a focused hospitality team and is already underwriting numerous repositioning and reflagging opportunities, he adds.
Canyon is a value-added capital provider, providing debt and equity on particularly complex transactions. The firm's track record in hospitality spans a diverse portfolio that includes the Washington Hilton, Hotel 71 in Chicago, W Austin Hotel and Residences and the Cal Neva resort in Lake Tahoe.
CCRA has not disclosed how much capital the firm plans to invest in hotels, but managing partner Bobby Turner says that Canyon's plan is to expand its deployment of value-added debt and equity capital in the hospitality sector and to leverage its presence in existing markets throughout the US. He cites Bosworth's experience in structuring investments, hotel operational management and special servicing.
Since the mid-1990’s, Bosworth has been involved in originating and structuring both hotel debt and equity investments, and managing nonperforming hotel and gaming assets. After the travel industry downturn in 2001 and the subsequent illiquid capital markets for hospitality finance, Bosworth assisted the five top-rated special servicers with their nonperforming hotel and casino loans, participating in over 30 lender workouts.
According to Bosworth, CCRA is seeing "many excellent hotel assets and repositioning opportunities that are currently over-leveraged." He adds, "Oftentimes, the underlying asset is perfectly capable of successfully performing in today’s economic climate with the right capital structure. In some cases, we envision infusing equity. In others, we see opportunities to issue debt and assist borrowers in refinancing their existing loans."
CCRA principal Jonathan Roth adds that Canyon believes market fundamentals "are very strong for continued strategic hotel acquisitions and recapitalizations. We expect to be very active in markets across the country where there is a high volume of projected hotel loan defaults combined with improving supply/demand and RevPAR economics.”
Canyon Capital Realty Advisors LLC and its affiliate Canyon Capital Advisors LLC have approximately $17 billion of capital under management. Its real estate activities focus on providing debt and equity capital to real estate owners, operators, developers, corporations and entrepreneurs, while its investments include a mix of real estate property types including retail, entertainment, multifamily, industrial, office, hospitality, land, mobile home and mixed-use and mortgage loans secured by such property types.
Continue Reading for Free
Register and gain access to:
- 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
Already have an account? Sign In Now
© 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.
