Archive for the ‘Resorts’ Category
Tuesday, April 30th, 2013
The real estate market has significantly improved since the beginning of the Great Recession, as indicated by recent year-end reports, such as the ULI Emerging Trends 2013. As the U.S. continues to see modest gains in market fundamentals, the recovery will maintain throughout the year. Certain asset classes are seeing tremendous value increases, including the hospitality sector.
The market for available and favorable financing, paired with great operating performance, has led to an up-cycle within this property sector. It has also created a more compelling reason for Real Estate Investment Trusts (REITs), Private Investment Management Firms and Sovereign Wealth Funds to chase hospitality assets. As a result, there has been an uptick in hospitality transactions over the past 12 months, and experts are predicting further activity throughout 2013.
To read the full article from Paradigm Tax Group, click here.
Posted in Country Clubs, Economy, Golf Courses, Hospitality, Hotels, Paradigm Info, Real Property, Resorts | No Comments »
Tuesday, November 27th, 2012
Property tax is not a fixed expense. It is manageable but often requires hiring someone experienced with these ad valorem taxes to assist. Hotel assets are very sophisticated investments that are typically left to those savvy investors that have specific knowledge of the operations. So the process of choosing a property tax consultant to represent you should entail as much sophistication and savvy as the buying process. The article discusses who the consultants are and the Pro’s and Con’s of each type; why hotel assets deserve more than just a local consultant; how to compensate the consultants; and how to evaluate their performance. Armed with all of this information, one should be ready to truly manage below the line.
To read the full article from Paradigm Tax Group, click here.
Posted in Country Clubs, Economy, Golf Courses, Hospitality, Hotels, Paradigm Info, Personal Property, Real Property, Resorts | No Comments »
Tuesday, August 28th, 2012
A recent article in HotelNewsNow.com discusses the considerations for choosing, compensating and evaluating third-party consultants hired to manage hospitality property tax expenses.
Highlights of the article include: final results that are at or below 100% of target value are home runs; typical contingency fees are 25% of tax savings for lower level cases; and, in the case of hotels, locality experience might not be as valuable as asset experience.
To read the full article, including in-depth detail on evaluating, choosing and compensating a property tax consultant, and how in general, the choice is not as simple as how much money you save, click here.
Posted in Country Clubs, Economy, Golf Courses, Hospitality, Hotels, Real Property, Resorts | No Comments »
Thursday, March 15th, 2012
Several demand drivers are placing the hospitality sector in a position for robust growth in the near future. According to Marcus & Millichap’s Research Quarterly Update, forecasts for the hospitality sector expect an overall 60.7% occupancy, an average daily rate of$105.70 and RevPAR of $64.21 by the end of 2012, up from 60.1%, $101.60, and $61.06 respectively in 2011. Still though, a couple risk factors exist that investors should be wary of.
The most troubling risk factor for the hospitality industry is the rising gas prices and the fact that they will be keeping many travelers at home this summer. Whether it is filling up at the pump, or increased ticket prices for flights, even the most dedicated traveler will think twice about booking vacations this year. The higher gas prices could help increase in-state traveling, but could severely impact leisure travel.
To read the full article from GlobeSt.com, click here.
Posted in Hospitality, Hotels, Real Property, Resorts | No Comments »
Thursday, November 17th, 2011
Paradigm Tax Group recently sponsored and presented at the iGlobal Hospitality & Lodging Investment Summit 2011 in New York City. The one-day event provided a snapshot of the current health and future outlook for the global hospitality industry. Through a series of focused panel discussions, the event examined emerging trends and opportunities, along with the costs, benefits, risks and rewards of hospitality investments now and into the foreseeable future.
The general outlook from the Summit regarding the hospitality industry was optimistic. However, that optimism was met with a few concerns regarding both the US and European economies. Overall, the feeling was that there are good opportunities in the market if some level of economic growth can be established. Hotel deals appear to be back in the spotlight as several key indicators of hospitality health are registering solid gains.
To read the full summary on the iGlobal Hospitality & Lodging Investment Summit 2011 from Paradigm Tax Group, click here.
Posted in Country Clubs, Eastern, Golf Courses, Hospitality, Hotels, Paradigm Info, Real Property, Resorts | No Comments »
Thursday, June 16th, 2011
According to analysis conducted by PKF Hospitality Research, if oil prices reach $150+ a barrel, the recovery the U.S. hotel market is currently enjoying could come to a severe halt. Research found that when oil prices increase beyond normal levels ($125+ per barrel), individual business and consumer spending power is reduced, which in turn has a negative multiplier effect throughout the economy in general and the lodging industry specifically.
Experts from Moody’s have concluded that the U.S. economy could handle prices rising to $125 per barrel, but a surge to $150 per barrel could trigger a mild recession with GDP growth falling by a maximum of 2.6% to an annualized low of 1.5% in 2012. When Moody’s analysis is applied to the PKF research, the dampening effect of high oil prices on RevPAR becomes clear. Currently, U.S. hotel RevPAR is projected to increase a combined 16.3% over 2011 and 2012, but, if prices rise to $125 per barrel, the percentage decreases to 10.1%. If prices reach $150 per barrel, RevPAR growth will be limited to a very modest 6.9%.
For a free download of the report by PKF Hospitality Research titled, “Oil Prices and Lodging Risk”, click here.
Posted in Economy, Hospitality, Hotels, Real Property, Resorts | No Comments »
Thursday, April 21st, 2011
The VictoryLand gambling resort just east of Montgomery, Alabama failed to pay $1.3 million in state and local property taxes for 2010. The resort has also been unable to make payments to lenders for its luxury hotel ever since their electronic bingo casino was shut down. VictoryLand, which pulled in huge crowds from Alabama and Georgia, had to close down 6,000 machines in the casino in order to prevent a raid from the Alabama Task Force Against Illegal Gambling. The revenue lost from the shutdown of the casino has also prompted the closure of the hotel and restaurants on the resort campus.
The dog track on site, though not as popular as before, will not be affected by the tax problems, but won’t make enough money to cover property taxes and other expenses. Since VictoryLand failed to pay its 2010 property tax bill, an auction was held this week in which no one bid on the track, casino or hotel, meaning that they technically go to the state. However, VictoryLand’s owner can still pay the back taxes plus a 12% interest during the next three years to retain the property and assets.
VictoryLand is the largest taxpayer in the county and has never had previous problems filing on time until the shutdown of the casino. As a result, the county has lost significant property tax and sales tax revenue as well as seen joblessness increase.
Posted in Complex, Eastern, Hospitality, Hotels, Personal Property, Real Property, Resorts | No Comments »
Tuesday, January 18th, 2011
In Arizona, there are several classes of property (1 -9). Each class of property has its own ratio (the percentage applied to the Full Cash Value to arrive at the Assessed Value). For example: Class 1 (commercial property), 20%; Class 2 (vacant land), 16%; Class 4 (rental residential property), 10%; Class 9, 1%.
A recent hospitality client of Paradigm Tax Group presented itself as a very unique property. It is a large convention hotel built on State Land. This type of property is called an IPR (Improvements on (of) Possessory Rights). Since the improvements are not secured to the land (land not owned by the same entity as the owner of improvements), IPR’s are considered Personal Property.
In reviewing the statutes, Paradigm Tax Group successfully determined that this property should qualify as Class 9 (1%), thereby lowering the ratio from Class 1 (20%) and effectively saving our client 95% on its property taxes. To become Class 9, the following criteria had to be met:
- The improvements had to be owned by our client.
- The land must be owned by a government entity.
- The improvements must be used primarily for Convention or recreational use.
- At the end of the lease, the improvements must be turned over to the government entity who owns the land.
(more…)
Posted in Country Clubs, Golf Courses, Hospitality, Hotels, Personal Property, Real Property, Resorts, Western | No Comments »
Monday, December 13th, 2010
For two years, big investors have watched the implosion of the hospitality industry as hotel values plummeted more than 50%. It appears though, according to The New York Times, that the industry has hit rock bottom and can only go up from here, as private equity giants like the Blackstone Group and entrepreneurs like Richard Branson are diving into the sector, leading many to think that it may be bouncing back.
So far in 2010 there have been 77 lodging deals in the United States valued at $8.5 billion, up from 30 deals valued at $1.2 billion at this point in 2009. While the good news is still far short of the 2007 peak of 141 deals valued at $42.3 billion, including the biggest buyout of a hotel ever in Blackstone’s $26 billion purchase of Hilton Hotels, the hospitality industry is definitely taking strides in the right direction.
To read the full article from The New York Times, click here.
Posted in Hospitality, Hotels, Real Property, Resorts | No Comments »
Tuesday, October 12th, 2010
Updating on an August post about Southeast Georgia’s Sea Island filing for bankruptcy, it has now been made public by the AP that the resort has been sold in auction for $212 million. According to the Atlanta Business Chronicle, the bidders; Oaktree Capital Management, Capital Avenue Group, Starwood Capital Group and the Anschutz Corporation all partnered on the deal.
The Chapter 11 filing, listing 1,000+ creditors that are owed up to $1 billion, coincided with an agreement to sell Sea Island’s assets to Avenue Capital and Oaktree Capital for $197.5 million. The bankruptcy judge had previously rejected an offer from Starwood Capital group for $199 million, which then removed themselves from initial bidding. Fallout from the recession ultimately has ravaged the historic five-star resort which had had to lay off hundreds of employees over the past couple years.
To read the full article from the Atlanta Business Chronicle, click here.
To see Paradigm’s August 11, 2010 post on Sea Islands’ bankruptcy filing, click here.
Posted in Bankruptcies, Eastern, Financial Services, Hospitality, Paradigm Info, Real Property, Resorts | No Comments »
