Weathering the storm of the last two years following the pandemic hasn’t been easy for any lodging companies, but for a small entrepreneurial firm like Woodmont Lodging carving its niche in hospitality has been that much more challenging.
Nevertheless, earlier this month the Bethesda, MD-based company celebrated its seventh anniversary having built an ownership portfolio of seven hotels with a plan for continued growth. Founded by principals Michael Blank and Elliott Estes—two lodging industry veterans who worked together at RLJ Lodging Trust prior to starting the company—Woodmont offers investment, asset management and advisory services as well.
“I’m really proud of what Michael and I have accomplished. We could have launched this company in 2015 ran into COVID and not survived and I would still be proud of what we accomplished. I know that we’ve taken on something that most don’t and I’m really proud of the platform that we have after surviving a difficult period,” said Estes.
He further added that despite COVID’s impact “we’re right on schedule with our goals and aspirations of business planning.”
Blank, meanwhile, touted the flexibility of being a company in its relative early days.
“We had a decent coming out when we started our company. I think the reality is the benefit of being small enough to grow is that there’s a lot of ways to be successful in this business and there’s not one cookie-cutter approach that’s better than the other. I think our portfolio has reflected our ability to identify opportunities within our thesis and outside of our thesis, but each one presents equal opportunities,” he said.
The company’s most recent opportunity was the acquisition of the Holiday Inn Asheville East-Blue Ridge PKWY in North Carolina. Estes maintained the overall portfolio has performed very well, but specifically highlighted The Clifton, a 20-room boutique property in Charlottesville, VA, as “one of our strongest performers through COVID.”
Another notable opportunity for Woodmont has been its partnership in the 386-room Sheraton Milwaukee Brookfield Hotel in Wisconsin, which recently underwent an $11 million Phase one PIP [property improvement plan] and is slated for another $4 million Phase two PIP later this year. The company also owns properties under the Days Inn by Wyndham, Fairfield Suites by Marriott, SpringHill Suites by Marriott, and Home2 Suites by Hilton flags.
All of the company’s properties—which are primarily located on the East Coast—are third-party managed. Estes credited these companies, such as Newport Hospitality, in part for the stellar performance of the portfolio.
“They have all been fantastic in managing operationally through COVID, but also tending to the physical asset to make sure that we didn’t get behind on general conditions. All of our properties are in good shape,” he said.
Estes noted the company looks for investment partners on a case-by-case basis describing Woodmont as a “young, hungry firm that’s opportunistic.”
Blank acknowledged that the acquisition market hasn’t been as robust as many industry followers expected, but he stressed that the company’s relationships have netted lots of opportunities.
“There’s always going to be an opportunity to find interesting deals that aren’t widely marketed. This is still a relationship business so we’ve been fortunate to be looking at assets that aren’t probably marketed to the world. Our most recent deal was a completely off-market transaction. So while it is a competitive landscape we’ve been fortunate to cultivate relationships that give us access to deals that aren’t widely available to the world,” he said.
Looking ahead, Blank was generally bullish on growth going forward.
“I think the sky is the limit. It really is a momentum thing, heading out of COVID we feel that there’s a lot of momentum behind us that will let us grow exponentially,” he said.
Estes also acknowledged that the company would ultimately like to build a larger portfolio, but he also emphasized the importance of properly supporting that growth as he detailed the company’s strategy.
“The last five to seven years has been getting into the industry as entrepreneurs and establishing our own relationships and track record. The next five to seven years is really going to be on infrastructure and staffing and building the team. From an asset count we’d love to be in that 25- to 30-range five years from now and we have the right capital partners and advisers to get us there. But we have to build systems and hire talent that matches that pace. After five years, we’ll take another deep breath and reassess the ceiling,” he said.