”The hotel business is cyclical. The upper-priced properties led the US lodging industry out of the recession and have continued to achieve occupancy levels in excess of 70%. However, recently it has been the lower-priced properties that have shown the greatest gains in RevPAR. In the past five years, RevPAR for US hotels increased at compound annual rate (CAGR) of 5.7%. The only chain-scale close to achieving this pace of revenue growth was the economy segment whose average annual RevPAR increase was 5.6% during this period. That means independent and economy chain-affiliated properties have been the primary drivers of the industry's recent strong performance.” (Source: R. Mark Woodworth, senior managing director of CBRE Hotels' Americas Research)

NEWS & NOTABLES

NASHVILLE—Phillips Edison & Company named senior leasing professional Scott Faloni as “Top Leasing Producer” and senior regional property manager Nikki Davidson as “Property Manager of the Year” for 2016. “This is the third year that Scott has earned the title of Top Leasing Producer, a difficult feat in our highly competitive and skilled leasing team and a testament to Scott's skill and success,” says Ron Meyers, senior vice president of Leasing. “Scott's outgoing personality, great sense of humor and outstanding professional reputation have enabled him to form strong relationships and a solid professional network. These qualities, along with his energy and enthusiasm, make him a great asset to the team.”

GONZALES, LA—Home2 Suites by Hilton announced its newest property, Home2 Suites by Hilton Gonzales. Offering 97 suites, the hotel complements Louisiana's growing tourism revenues, which increased 3% year-over-year in 2015. Located at 2708 West Outfitters Drive, Home2 Suites by Hilton Gonzales offers access to the historical Plantation Alley on The Great River Road, Lamar-Dixon Expo Center, shopping, including Tanger Outlets and Cabela's outdoor sports store, and traditional Louisiana cuisine. Gonzales is also known as the “Jambalaya Capital of the World” where guests are welcome to enjoy the annual Jambalaya Festival in the springtime. The hotel is located right off Interstate 10 and is in the heart of the global petroleum, bioplastics engineering and technology arena.

DEAL TRACKER

NASHVILLE—GBT Realty Corporation acquired a site in the southeast to deliver unanchored shopping centers in markets with high barriers to entry. In Baton Rouge, GBT acquired an .86-acre site from Target along Millerville Road, Avalon's prime commercial corridor. Shadow-anchored by Target, Best Buy, Lowe's Home Improvement, PetSmart and Office Depot, the 6600-square foot center is 100% leased to national names including Pacific Dental, GNC and Zoës Kitchen that are expected to open late this year. The site traded hands for $810,000 in a transaction that was finalized last month. Construction is currently underway at 2001 Millerville Road at Interstate 12.

LAFAYETTE, LA—Berkadia arranged the $18.73 million loan for the River Ranch Retail Portfolio, a set of 10 retail and dining properties anchored by Fresh Market and Paul Michael Company located in Lafayette. Director Cameron Hart of the Austin, Texas office secured the 10-year, fixed rate loan from Goldman Sachs Mortgage Company on behalf of the borrower. The retail properties are part of The Village of River Ranch located at the crossing of Settler Trace Boulevard and Camellia Boulevard in southwest Lafayette. The development is a 321-acre, walkable, mix-use community consisting 500 residential houses, 550 townhomes, apartments and condominiums and over 800,000 square feet of retail and office.

BIRMINGHAM—The Pizitz celebrated its official grand opening. The Pizitz Food Hall features 13 vendor stalls and two full-service restaurants with cuisines from around the world, surrounded by a central bar named The Louis, along with Yellowhammer Creative's retail store and Warby Parker, the first in the state of Alabama. The Pizitz Food Hall is expected to be a foodie haven, bringing visitors from Birmingham and beyond. The Residences at The Pizitz that occupy the six upper floors of The Pizitz opened in December 2016. The Pizitz building sat empty for more than a quarter century after its namesake department store closed. Now the structure houses 143 one-and-two-bedroom apartments, 13,000 square feet of modern and co-working office space, The Pizitz Food Hall, and will soon be home to Sidewalk Film Festival's permanent offices in addition to two 100-seat theatres, and classrooms for educational programs.

VIDALIA, GA—The packing house, land and equipment formerly used in the produce operations for Plantation Sweets will be offered in a bank-ordered auction on April 26. These assets were a major part of one of the larger growing and packing operations for Vidalia onions and sweet potatoes in Georgia. The modern packing facility has 94,000 square feet of atmospherically controlled area, as well as a 13,350-square-foot shop/equipment shed. Also selling will be parcels of land ranging from 14 to 182 acres and a tract consisting of the processing equipment used in the sorting and packing of onions and sweet potatoes. The land, located near Cobbtown, includes seven different farms, with approximately 567 farmable acres and 11 irrigation ponds totaling approximately 24 acres. It has 15 pivots and two wells for irrigation.

BIRMINGHAM— CS1031 Birmingham MOB, DST acquired a newly-constructed, 8,140-square-foot medical office building that was built-to-suit for Fresenius Medical Care. Located at 3671 Roosevelt Boulevard in Birmingham, the property is leased on a net basis for a base term of 15 years, plus extensions. Capital Square leveraged the property for exchange investors who need debt to obtain complete deferral under Section 1031 of the Internal Revenue Code.

NASHVILLE, TN—Ardent Health Services acquired LHP Hospital Group. The company is now the second-largest private, for-profit hospital operator in the US with 19 hospitals in six states and $3 billion in revenues. Terms of the transaction were not disclosed. Ardent will continue LHP's emphasis on joint venture partnerships with not-for-profit and academic health systems, and the company has assumed LHP's management and operational responsibilities within each of its existing partnerships. Former LHP Interim CEO Paul Kappelman has been appointed executive vice president and chief operating officer for Ardent. Kappelman will oversee day-to-day operations of the hospitals, clinics and business units within each of the company's markets, as well as Ardent's quality, financial operations and physician recruitment efforts.

OXFORD, MS—Nelson Brothers Professional Real Estate recently closed on the purchase of Molly Barr Trails and Molly Barr Ridge, two adjacent student housing properties near the University of Mississippi. The properties were recently built—2012 and 2015 respectively—and fully amenitized. At the time of purchase, both properties were at 100% occupancy with 12-month leases. The offering was offered as a DST (Delaware Statutory Trust) structure and eligible for 1031 investors.

ATLANTA—Here's a look at the trends, announcements and deals you may have missed this week in the Southeast.

This week in the Southeast we discover some interesting hotel statistics from CBRE Hotels Americas Research even as the commercial real estate industry promotions continue into the first quarter of 2017. Beyond the usual Georgia activity, Nashville, Oxford, MS, and Birmingham and secondary markets in Louisiana are making headlines.

BY THE NUMBERS

US hotels enjoyed another year of life at the performance peak in 2016 and are forecast to continue to live the high life in 2017. Rooms revenue (RevPAR) grew for a seventh consecutive year in 2016, and the prospects for RevPAR growth are projected to be solid for the foreseeable future. What is surprising, however, is the impetus for sustained revenue expansion comes from some unexpected sources. (Source: March 2017 Hotel Horizons forecast report from CBRE Hotels' Americas Research)

”The hotel business is cyclical. The upper-priced properties led the US lodging industry out of the recession and have continued to achieve occupancy levels in excess of 70%. However, recently it has been the lower-priced properties that have shown the greatest gains in RevPAR. In the past five years, RevPAR for US hotels increased at compound annual rate (CAGR) of 5.7%. The only chain-scale close to achieving this pace of revenue growth was the economy segment whose average annual RevPAR increase was 5.6% during this period. That means independent and economy chain-affiliated properties have been the primary drivers of the industry's recent strong performance.” (Source: R. Mark Woodworth, senior managing director of CBRE Hotels' Americas Research)

NEWS & NOTABLES

NASHVILLE—Phillips Edison & Company named senior leasing professional Scott Faloni as “Top Leasing Producer” and senior regional property manager Nikki Davidson as “Property Manager of the Year” for 2016. “This is the third year that Scott has earned the title of Top Leasing Producer, a difficult feat in our highly competitive and skilled leasing team and a testament to Scott's skill and success,” says Ron Meyers, senior vice president of Leasing. “Scott's outgoing personality, great sense of humor and outstanding professional reputation have enabled him to form strong relationships and a solid professional network. These qualities, along with his energy and enthusiasm, make him a great asset to the team.”

GONZALES, LA—Home2 Suites by Hilton announced its newest property, Home2 Suites by Hilton Gonzales. Offering 97 suites, the hotel complements Louisiana's growing tourism revenues, which increased 3% year-over-year in 2015. Located at 2708 West Outfitters Drive, Home2 Suites by Hilton Gonzales offers access to the historical Plantation Alley on The Great River Road, Lamar-Dixon Expo Center, shopping, including Tanger Outlets and Cabela's outdoor sports store, and traditional Louisiana cuisine. Gonzales is also known as the “Jambalaya Capital of the World” where guests are welcome to enjoy the annual Jambalaya Festival in the springtime. The hotel is located right off Interstate 10 and is in the heart of the global petroleum, bioplastics engineering and technology arena.

DEAL TRACKER

NASHVILLE—GBT Realty Corporation acquired a site in the southeast to deliver unanchored shopping centers in markets with high barriers to entry. In Baton Rouge, GBT acquired an .86-acre site from Target along Millerville Road, Avalon's prime commercial corridor. Shadow-anchored by Target, Best Buy, Lowe's Home Improvement, PetSmart and Office Depot, the 6600-square foot center is 100% leased to national names including Pacific Dental, GNC and Zoës Kitchen that are expected to open late this year. The site traded hands for $810,000 in a transaction that was finalized last month. Construction is currently underway at 2001 Millerville Road at Interstate 12.

LAFAYETTE, LA—Berkadia arranged the $18.73 million loan for the River Ranch Retail Portfolio, a set of 10 retail and dining properties anchored by Fresh Market and Paul Michael Company located in Lafayette. Director Cameron Hart of the Austin, Texas office secured the 10-year, fixed rate loan from Goldman Sachs Mortgage Company on behalf of the borrower. The retail properties are part of The Village of River Ranch located at the crossing of Settler Trace Boulevard and Camellia Boulevard in southwest Lafayette. The development is a 321-acre, walkable, mix-use community consisting 500 residential houses, 550 townhomes, apartments and condominiums and over 800,000 square feet of retail and office.

BIRMINGHAM—The Pizitz celebrated its official grand opening. The Pizitz Food Hall features 13 vendor stalls and two full-service restaurants with cuisines from around the world, surrounded by a central bar named The Louis, along with Yellowhammer Creative's retail store and Warby Parker, the first in the state of Alabama. The Pizitz Food Hall is expected to be a foodie haven, bringing visitors from Birmingham and beyond. The Residences at The Pizitz that occupy the six upper floors of The Pizitz opened in December 2016. The Pizitz building sat empty for more than a quarter century after its namesake department store closed. Now the structure houses 143 one-and-two-bedroom apartments, 13,000 square feet of modern and co-working office space, The Pizitz Food Hall, and will soon be home to Sidewalk Film Festival's permanent offices in addition to two 100-seat theatres, and classrooms for educational programs.

VIDALIA, GA—The packing house, land and equipment formerly used in the produce operations for Plantation Sweets will be offered in a bank-ordered auction on April 26. These assets were a major part of one of the larger growing and packing operations for Vidalia onions and sweet potatoes in Georgia. The modern packing facility has 94,000 square feet of atmospherically controlled area, as well as a 13,350-square-foot shop/equipment shed. Also selling will be parcels of land ranging from 14 to 182 acres and a tract consisting of the processing equipment used in the sorting and packing of onions and sweet potatoes. The land, located near Cobbtown, includes seven different farms, with approximately 567 farmable acres and 11 irrigation ponds totaling approximately 24 acres. It has 15 pivots and two wells for irrigation.

BIRMINGHAM— CS1031 Birmingham MOB, DST acquired a newly-constructed, 8,140-square-foot medical office building that was built-to-suit for Fresenius Medical Care. Located at 3671 Roosevelt Boulevard in Birmingham, the property is leased on a net basis for a base term of 15 years, plus extensions. Capital Square leveraged the property for exchange investors who need debt to obtain complete deferral under Section 1031 of the Internal Revenue Code.

NASHVILLE, TN—Ardent Health Services acquired LHP Hospital Group. The company is now the second-largest private, for-profit hospital operator in the US with 19 hospitals in six states and $3 billion in revenues. Terms of the transaction were not disclosed. Ardent will continue LHP's emphasis on joint venture partnerships with not-for-profit and academic health systems, and the company has assumed LHP's management and operational responsibilities within each of its existing partnerships. Former LHP Interim CEO Paul Kappelman has been appointed executive vice president and chief operating officer for Ardent. Kappelman will oversee day-to-day operations of the hospitals, clinics and business units within each of the company's markets, as well as Ardent's quality, financial operations and physician recruitment efforts.

OXFORD, MS—Nelson Brothers Professional Real Estate recently closed on the purchase of Molly Barr Trails and Molly Barr Ridge, two adjacent student housing properties near the University of Mississippi. The properties were recently built—2012 and 2015 respectively—and fully amenitized. At the time of purchase, both properties were at 100% occupancy with 12-month leases. The offering was offered as a DST (Delaware Statutory Trust) structure and eligible for 1031 investors.