Month: December 2022

Gencom and Corten will acquire ownership stake in eight U.S. hotels comprising 1,400+ rooms and suites; Gencom affiliate Pyramid Global Hospitality will manage operations for the portfolio

MIAMI, FL, WILMINGTON, DE and PORTLAND, OR – December 15, 2022 – Affiliates of Gencom, an international owner and developer of hospitality and residential properties, and Corten, a Mid-Atlantic based private real estate investment fund manager, today announced the closing of a strategic venture with Provenance Hotels, an independent owner of boutique hotels. Under the venture, a Gencom-led partnership has acquired a 50 percent ownership stake in eight hotels across the United States, expanding the Miami-based firm’s portfolio by more than 1,400 rooms and suites. In a related transaction, Gencom affiliate Pyramid Global Hospitality, which oversees hotel property management and operations throughout the U.S. and Europe, has acquired the Provenance Hotels operating company and will add 12 full-service hotels to its national network of managed properties.

The venture between Gencom and Provenance represents the first transaction between these firms, each with celebrated histories in their respective segments of the market. It’s also the first time Gencom has partnered with Corten on a multi-asset deal.

• Founded more than 35 years ago, Gencom has grown to become one of the nation’s leading firms specializing in the development and management of luxury resort and residential properties, alongside full-service hospitality operating platforms. Today, the Gencom portfolio is comprised of nearly $7 billion in assets under management and includes 15 assets in operation or under development with over 7,000 hotel rooms around the world. Gencom’s portfolio also includes two distinct affiliated operating platforms: Pyramid Global Hospitality, and etc. venues.
• Founded in 2018, Corten’s partners have decades of principal real estate investment and management experience with a demonstrated track record in acquisitions, design/development/construction, and property/asset/fund management. Known for its creative capital solutions, the firm and its principals have invested in over 70 hotels, in excess of 15,000 keys, and over $4 billion of total capitalization.  
• Launched in 1985, Provenance Hotels is a premiere owner and operator of independently branded boutique hotels in destination cities across the U.S.

“Gencom’s venture with Provenance is a textbook example of our approach in identifying an opportunity and executing a creative investment strategy that complements our existing holdings,” explains Gencom’s Chief Investment Officer Alessandro Colantonio. “Gencom took a calculated risk entering this transaction during the height of the pandemic. While many were skeptical about the future of hospitality, we saw value in the Provenance portfolio’s real estate assets and believed these destinations would bounce back stronger. Today, Nashville, Seattle and New Orleans are among the top-performing hotel markets in the U.S.”

Brandon Flury, a principal leading Corten’s hospitality investments, added, “Our firm’s vertical expertise in this space allowed for an immediate philosophical alignment with Gencom and also facilitated an efficient execution of this highly nuanced opportunity. We are generally drawn to complex situations that require highly tailored capital solutions for joint venture partners like Gencom and Provenance, while at the same time meeting the return objectives of our institutional investors.”

Founder and Chairman of Provenance Gordon Sondland said, “We are excited about the opportunities this venture provides to our team members and guests, and we will be evaluating capital improvements to properties of the Fund. The Provenance management team will remain actively involved in the business, and we look forward to working with Gencom and Corten as we explore new areas for growth, both domestically and internationally. In particular, I plan to leverage the knowledge of the European market I gleaned during my time as U.S. Ambassador to the European Union.”

For Pyramid, the acquisition of Provenance Hotels’ operating company represents a strategic entry into new markets, according to Gencom Founder and Principal Karim Alibhai. “Pyramid Global Hospitality’s continued expansion in the hotel operations space is core to the strength of Gencom’s platform strategies. By acquiring Provenance Hotels and assuming third-party management of twelve additional properties with nearly 2,000 rooms, Pyramid now has a presence in several new markets that will present opportunities for future growth and support Gencom’s continued pursuit of opportunistic real estate assets and its overall growth initiatives.”

Eight hotels will be jointly owned by a Gencom-led partnership and Provenance: the Dossier, Sentinel, Hotel Lucia and Hotel Deluxe in Portland, Oregon; Old No. 77 Hotel & Chandlery in New Orleans; Hotel Max and Hotel Murano in Seattle; and Hotel Preston in Nashville. These properties are home to a combined 1,407 rooms and suites.  In addition to the eight hotels, Pyramid will manage four hotels owned by third parties which were previously operated by Provenance: Hotel Theodore in Seattle, Heathman Hotel and Woodlark Hotel in Portland, and The Bradley in Fort Wayne, Indiana. In total, Pyramid’s portfolio of managed properties will grow by 1,952 rooms and suites.

About Gencom

Gencom is a U.S.-based investment firm that owns, operates and develops prized real estate around the world, with an emphasis on luxury hotels, resorts and branded residential properties; and which is also an active owner and investor in hospitality operating platforms. Gencom’s current real estate portfolio is comprised of some of the world’s most iconic hotels, resorts, and destinations which are amongst the leading properties in the industry with key operating partners such as Four Seasons, Ritz-Carlton, Rosewood, Auberge, Fairmont, Hyatt, Marriott and St. Regis. www.gencomgrp.com

About Corten 

Corten Real Estate is a private investment manager that targets middle-market common and preferred equity (direct and joint venture), subordinated debt and whole loan investments in hospitality, multifamily, and office properties located throughout the U.S.  Corten’s sector expertise and ability to invest up and down the capital stack allow it to provide tailored funding solutions to operating partners/sponsors.  Corten is headquartered in Wilmington, DE, with satellite offices in the Philadelphia, PA and Chevy Chase, MD. www.cortenrealestate.com

About Provenance Hotels

Headquartered in Portland, Oregon, Provenance Hotels owns, develops and manages market-leading independent hotels. Imbued with intentional, deeply integrated art stories, these Conde Nast Reader’s Choice Award-winning hotels showcase trend-setting amenities, creative collaborations with local co-conspirators and innovative food & beverage operations while focusing on operational efficiency and profitability. The portfolio includes 12 properties totaling nearly 2,000 keys.www.provenancehotels.com

Karim Alibhai, the founder of the Miami-based development company Gencom, talks about trends in luxury development in Costa Rica, the Bahamas and beyond

BY SHIVANI VORA

ORIGINALLY PUBLISHED ON DECEMBER 12, 2022

Karim Alibhai, the founder and principal of the Miami-based development company Gencom, may have more than 20 significant residential projects to his name, but he has managed to be among the more under-the-radar developers in the industry. 

His ventures focus on resort settings globally and comprise primarily luxury branded residences. Examples include Ritz-Carlton residences in Philadelphia; Key Biscayne, Florida; and Bachelor Gulch, Colorado; as well as Rosewood Tucker’s Point and Fairmont Southampton in Bermuda.

Mr. Alibhai’s most recent project is Peninsula Papagayo, a 1,400-acre development in North Pacific Cost Rica that Gencom acquired in 2016 in partnership with the Cyprus-based investor Mohari Hospitality. The more than $1 billion master-planned community includes two hotel brands with residences attached—Four Seasons Hotels and Resorts and Andaz—and is in the middle of a major growth spurt. 

Mr. Alibhai, 58, who was born in Kenya, spoke to Mansion Global about the must-have amenities for any luxury development and why buyers from their 30s to 50s are now his company’s biggest customers.

Mansion Global: Peninsula Papagayo is known for its many amenities, and several more are in the works. Can you describe what currently exists and the ones still to debut?

Karim Alibhai: We have two beach clubs, three spas and several fitness centers with the latest equipment—they all also offer exercise classes. The development also has a marina that can accommodate superyachts, an 18-hole golf course designed by Arnold Palmer, more than 15 restaurants, a tennis center, a nature center and an adventure outpost with a zipline, a ropes course and a mountain bike center. 

I am especially proud of our Explorer’s Club, which offers customized experiences, both on and off the property. We have guides that can take you trekking in the rainforest, for example, or on a cultural tour, and naturalists who can take you birdwatching or animal trekking, even after dark. 

Upcoming, we’re working on a 20-acre sports park with water slides and a standing surf wave, a village around the marina with boutiques and restaurants, two more beach clubs and a wellness-oriented spa. 

MG: These days, what are some amenities that every luxury development in a resort destination must have?

KA: Definitely a sizable spa with numerous experiences like saunas, treatments and different wet areas. When people are in a resort destination, they want to escape to a spa. Also, since guests are captive and stay on property, you need a breadth of restaurants and bars. It’s not enough to have one signature restaurant because people get bored. 

MG: Who are your customers?

KA: In the beginning, Gencom’s buyers were mostly retirees. In the last few years, the tables have turned, and we see younger buyers in their 30s, 40s and 50s. These age groups have amassed a good deal of wealth from tech companies or other ventures and are seeking a lifestyle where they can enjoy their wealth. 

MG: How important are star architects to home buyers today? 

KA: Big name architects do resonate with buyers, but they are not a deciding factor. First and foremost, buyers must love the design of the residence, irrespective of who designed it. The flow and layout are also key. In a resort setting like Costa Rica, outdoor space is a big deal. People want large areas outside where they can spend time. 

MG: What’s your definition of luxury?

KA: Excellent service. You can have the best home in the most beautiful, highly amenitized development, but it means nothing if there isn’t service to match. That means the staff at the restaurants, beach clubs, spas and gyms. They should know all residents by name and their children as well. They need to be personal and aware of their preferences and aversions. 

MG: With respect to your developments, do you decide to invest based on the potential of the destination or of the project itself? 

KA: For me, the destination is the primary driver and then the project. Bermuda is an example. I first looked at it in 2015. It was an “it” country in the 1980s, but at the time I came in, it was on a decline in terms of the quality of the real estate and hotels. The affluent crowd had forgotten about Bermuda and were looking at other destinations to buy homes such as Turks and Caicos and Grand Cayman. But I believed that Bermuda had legs. It offers a perfect mix of Caribbean blue waters and Hamptons chic with its manicured lawns. 

Gencom decided to invest. We believed that we could add value to the destination by taking over the Rosewood and Fairmont properties and renovating them to a high standard. We have also streamlined their operations. Rosewood has since increased its revenues by more than 10 times and is one of my favorite places to visit with my four kids. 

[This interview has been edited for length and clarity]

Link to Mansion Global Article