(DALLAS) – Munsch Hardt Kopf & Harr, P.C. (Munsch Hardt), a Texas-based, commercial law firm, announced client NewcrestImage, a family office investment firm focused on real estate assets and alternative investments, closed on a 45 hotel portfolio, including 35 Marriot-branded properties, seven Hilton-branded properties, and three Choice-branded properties in 11 states (Arkansas, Colorado, Illinois, Iowa, Kansas, Michigan, Minnesota, North Dakota, Ohio, South Dakota and Texas).
The transaction, announced in September 2022, encompassed approximately 3,300 rooms. NewcrestImage retained the management companies previously in place for the properties.
For much of 2022, NewcrestImage focused on acquisitions, purchasing 77 hotels and nearly 8,000 rooms since last March. The strategic acquisitions are part of the company’s tactical transition to create a growth-centered portfolio. “The current financial environment makes it very attractive to buy rather than build, and this group of fine hotels in high-traffic locations provides us with an exceptional opportunity to immediately start generating significant revenue, profit, and return on investment,” said Mehul Patel, Managing Partner and CEO of NewcrestImage.
Last year, Munsch Hardt represented NewcrestImage in approximately $1.4 billion in transactions, encompassing 106 hotels in 19 states, four hotel flags and more than seven credit facilities. The Munsch Hardt Team was led by Phillip J.F. Geheb, and also includes Julia Gasc Beckman, George “Jack” Casanova, Lindsay B. Kramer, Ryan J. Mitchell, Courtney L. Tawresey and Adrienne N. Wall.
“2022 was a landmark year for NewcrestImage,” says Geheb. “We strive to seamlessly work with our clients to accomplish their goals and are proud to have contributed to numerous successful transactions.”
These strategic acquisitions signal a broader market trend for 2023. “We expect to see a number of companies that built up their cash reserve in anticipation of an economic downturn take advantage of changing market conditions and an influx of properties coming onto the market,” stated Geheb. “The market conditions for hotel acquisitions are very positive even in a rising interest rate environment, and we expect to see increased activity in the hospitality sector.
Geheb added, “While construction costs have finally started to depress, the need for alternate sources of funding, such as New Markets Tax Credits, Historic Tax Credits, Low-Income Housing Tax Credits, Inflation Reduction Act incentives, ground lease capital, Property Assessed Clean Energy (PACE) financing and other state and local incentives has only increased. Clients like NewcrestImage have been able to take advantage of these market conditions by being nimble and familiar with all of these tools.”
When it comes to NewcrestImage, the Company shows no signs of slowing down this year, having announced a 16-property hotel portfolio set to close in the first quarter of 2023 that is led by Geheb and his team at Munsch Hardt.