Hospitality

Overview

Arent Fox represents clients in all aspects of the hospitality industry. We recognize that hospitality transactions involve more than just the real estate: these transactions involve many other tangible and intangible assets and an on-going business requiring a legal team with broad experience in a variety of practice areas.

Hospitality Transactions

Arent Fox handles hospitality transactions throughout the United States and in foreign countries. Our clients range from operators, investors and developers of large resort complexes with multifaceted ownership and financing structures, to urban developments with high-profile governmental involvement and public/private partnerships.

We have experience with franchised, independently owned properties and single “trophy” hotels. We also have experience in acquisitions and sales of existing properties, development of new properties, portfolio acquisitions of hotels, conference centers and resorts and commercial transactions relating to the multifaceted activities of the hospitality industry generally. We assist clients in every aspect of hospitality transactions:

• Site acquisition.
• Title and land-use review.
• Construction and development.
• Licensing and local compliance issues.
• Business formation and structuring of joint ventures.
• Review of environmental issues.
• Review and negotiation of architects’ agreements and construction contracts.
• Review and negotiation of complex multiparty agreements with public entities and development partners.
• Labor and employment law and benefits issues.
• Trademark and intellectual property.
• Franchise and hotel management agreements.
• Parking agreements.
• Specialized supply, service and technology contracts.
• Local and federal compliance.
• Business license analysis.
• Tax planning and analysis.
• Financing (including equity and debt offerings, mezzanine financing and preferred equity investments).

Hotel Development

Arent Fox has broad experience counseling developers of hotel and resort properties. Our clients range from multinational Fortune 100 clients to several private real estate and hotel development firms. We serve as counsel to several major regional, national and international hotel owners, operators, franchisors, and developers, as well as one of the largest owners of extended-stay properties.

Hotel Acquisition and Sales

Arent Fox clients range from hospitality-based companies involved in acquiring existing properties or entire brands for their own account, to Wall Street private equity investment funds involved in purchasing complete lodging portfolios, to local closely held businesses that may be interested in a single property.

Financing and Joint Ventures

Arent Fox represents hospitality clients in a wide variety of financing transactions. For those clients developing new properties, we negotiate site-acquisition and construction loans and handle all construction-related documentation required by lenders. In cases involving financing for hotel renovations, we represent clients with secured or unsecured loans providing funds for the new work and address the subordination issues related to any preexisting financing.

Arent Fox also represents borrowers in securitized financing transactions and is adept at dealing with rating agency requirements. When necessary, we draw on the resources of the Arent Fox Bond Department to assist with any bond elements of financing packages, particularly for downtown hotel projects, and utilize other Arent Fox finance experts to advise on other sophisticated financing techniques, such as tax increment financing.

Many of our hotel clients form ventures with third parties. We advise these clients on structuring their businesses to accommodate joint venture or other equity arrangements, and serve as counsel on sale-leaseback, ground leasing, mezzanine loan and preferred equity transactions.

Representative hospitality projects include:

• Development of a resort and spa, in Orlando, Fla., consisting of a 1,000-room hotel, a 584-room hotel, an 18-hole golf course, a 40,000-square foot spa and 100,000 square feet of meeting space.
• Acquisition by an extended stay hospitality group of more than 50 properties throughout the Northeast.
• Joint venture to redevelop hotel properties in Maui, Hawaii, providing a mix of uses, including whole and fractional ownership in residences.
• Acquisition and financing of a beach and golf resort in Cancun, Mexico.
• Acquisition and redevelopment of the Madison Hotel, a luxury property in Washington, DC
• Joint venture for the development of limited service hotels in various urban centers throughout the United States.
• Acquisition and sale of one of the largest resorts in Puerto Rico.
• Representation of various real estate investment funds managed by one of the largest investment banking firms, in connection with the sale of a portfolio of hotel properties in various locations in the United States.
• Assisting in the repositioning and restructuring of various troubled hospitality assets in a foreign Caribbean jurisdiction.
• Development of a 575-room resort, with a full service spa and a 27-hole golf course, in Tucson, Ariz.

Franchise and Intellectual Property

Arent Fox represents leading franchisors in the hospitality industry. We counsel franchisors and franchisees in the creation and expansion of franchise and distribution systems, as well as transactional and regulatory matters that affect franchisors. We have regulatory and business knowledge on a wide range of franchise and intellectual property issues. Services include:

• Establishing and maintaining licensing programs.
• Clearing, protecting, policing and enforcing trademarks and service marks domestically and abroad, including strategic brand counseling and management of large trademark portfolios under our Global Brand Management SolutionSM methodology.
• Selling system assets.
• Acquiring other franchisor-related systems or assets.
• Restructuring licensing relationships with existing franchisees.
• Settling disputes with other franchisors, franchisees and governmental agencies.
• Negotiating franchise arrangements for newly acquired hotel and resort properties.
• Addressing contests, sweepstakes, privacy, spam and other Internet and related marketing challenges.

Arent Fox hospitality clients include:

• Well-known multinational lodging clients, including several of the world’s largest hotel franchising and/or management companies.
• National real estate owners and developers.
• Real estate investment trusts.
• Restorers of historic hospitality properties.