Concord Hospitality Enterprises today announced the company's most aggressive development pipeline to date, with fourteen hotels currently in active development, seven which are scheduled to open in 2014.
"Because we believe there is a consistent market for strategically located, premium-branded hotels, we continued to build every economic cycle as we have every year for the past twenty years," said Mark Laport, president and CEO of Concord Hospitality. “However, we view this current phase as one of the strongest periods to be a hotel developer in recent memory, certainly in the past five years.
“We are in the fortunate position of being able to attract significant amounts of well-priced debt, supported by appropriate equity. We have partnered with several new investors in recent months and expect that trend to continue.
“The key is to not jump at every opportunity out there; as financing becomes more available and more projects get underway, discipline becomes especially important,” Laport cautioned. “While we are currently working the most aggressive pipeline in our history, we also are turning down more than ever. On average, only one out of every eight projects goes forward."
According to Laport, locations with high or growing concentrations of medical, educational, banking and technology concerns, and solid infrastructures attract the attention of hotel developers like Concord, which spent a record $10-plus million a month in development in 2013 and expects a total development spend of $1 billion by the end of 2014.
Hotels in Development
Targeted Brand Location Rooms
2nd Quarter 2014 Homewood Suites Pittsburgh Airport, PA 117
2nd Quarter 2014 Cambria Suites Washington, DC 182
2nd Quarter 2014 Residence Inn Secaucus, NJ 154
3rd Quarter 2014 Hilton Garden Inn Roanoke, VA 117
3rd Quarter 2014 Cambria Suites New York, NY (28 St.) 135
4th Quarter 2014 Courtyard Orlando, FL 128
4th Quarter 2014 Hyatt Place Miami Airport, FL 135
2015 Hyatt House Belmar Lakewood, CO 135
2015 Hyatt House Shadyside Pittsburgh, PA 128
2015 Cambria Suites New York, NY (46 St.) 196
2015 Hyatt House Jersey City, NJ 258
2015 Homewood Suites Pittsburgh, PA (Smallman ST.) 150
2015 Residence Inn Durham, NC 143
2016 Courtyard Greenwich, NY 314
Expanding Third-Party Management
In addition to the aggressive development roster, Laport noted that the company continues to grow its third-party management portfolio through strategic alliances with current institutional investors, as well as other ownership groups.
"The downturn demonstrated the importance of maintaining a healthy balance within the portfolio, and while development deals capture headlines, third-party management is a critically important part of our mix, and an area where we invest heavily to further establish our leading edge," Laport said. "Even with all of our recent development, our portfolio is now 40 percent owned/joint venture partnerships, and 60 percent third-party managed."
According to Laport, Concord's longstanding owner and brand relationships and investment in technology leadership are paying dividends in terms of contract growth and the company's growing prominence in the third party management sector.
Concord started 2014 with three new contracts from the Wickens Group, a Michigan-based owner/developer of premier commercial real estate. This early uptick comes on the heels of nine new management deals in 2013; a company record.
Concord earned 15 major hotel awards for 2012 performance and in December was awarded Marriot's top three honors, the Spirit to Preserve, Service Excellence and Partnership Service Awards.
"Every year we become more reliant upon technology and many hoteliers have struggled to keep up with the changes, not only for their own operations, but to meet guests' growing needs," said Laport. "We recognized years ago that technology could be a strategic differentiator, and deliberately developed a level of expertise and innovation that now separates us from other very capable operators. Our owners no longer worry about keeping abreast of new technology, because we make sure their hotels not only keep up but stay ahead."
About Concord Hospitality
Concord Hospitality Enterprises Company, an award-winning hotel management and development company based in Raleigh, N.C., manages more than 90 hotels offering more than 13,000 guest rooms in 20 states and two Canadian provinces. The company operates hotels and resorts under leading brand affiliations including Choice Hotels, InterContinental Hotels Group, Hilton, Hyatt, Marriott and Starwood, as well as select independent boutique hotels. Concord properties are some of the most awarded hotels in the country, having won nearly 100 top honors in the past two years alone.