Peachtree Hotel Group Has a Growth Spurt
- Jun 15, 2016
Atlanta—Peachtree Hotel Group just keeps on growing. The hotel operator and developer is enhancing its select-service portfolio in secondary markets with the acquisition of 10 hotels in transactions totaling approximately $183 million.
Grabbing 1,600 rooms where you want and when you want them is no simple feat, but it’s becoming simpler for Peachtree. “Over the past five years, competition has increased significantly as more institutional investors began targeting select-service hotels in secondary markets while debt was relatively easily attainable. However, more recently, many of the large institutional investors have become less active or are on the sidelines completely and hotel lending has become more constrained. As a result, there is less competition today as compared to six months ago,” Brian Waldman, senior vice president of investment with Peachtree, told Commercial Property Executive.
Peachtree has the capital to act when the right opportunities present themselves, and act it did when the 10 hotels came to the company’s attention. It’s a diverse collection in terms of both flags and geography. Four of the assets—two Hampton Inns, an Aloft brand and a DoubleTree conversion opportunity—are under contract. With an aggregate 600 rooms, they’ll go a long way toward expanding Peachtree’s presence in the Southeast and Midwest. The remaining six hotels, located in four states, are presently in development mode and upon completion, will operate under the Marriott, Hilton, IHG and Starwood brands.
Peachtree isn’t sharing additional details about the properties right now, but one fact is certain: they fit with the company’s strategy of targeting assets that can achieve greater success through superior management or capital investment. The portfolio expansion will become very real for Peachtree within the next 60 days, which is the timeframe for the closing on the four hotels under contract.
If history is any indication, Peachtree is far from finished with purchases for the year. In 2014, Peachtree snapped up 14 hotels, and by October of 2015, it had purchased 12 properties. Peachtree may not know when it will make its next acquisitions, but it does know where they’ll be made—in general. Waldman said, “Although we continue to seek acquisitions nationwide, our primary focus remains within Peachtree’s core footprint in the Southeast.”