Extending asset management and development services from Trinity Investments to other hotel owners and lenders has the potential for future projects.
Trinity has a successful track record of acquiring underperforming hospitality properties and executing comprehensive operational plans and capital repositioning strategies, said Greg Dickhens, the company's principal and managing director. That reputation led to this opportunity to work with other owners.
“We're hearing from a lot of different owners and even lenders that really value that expertise and would like to see us provide those types of services to their portfolios,” he said.
Hotel owners are looking for someone to provide more than just reporting and oversight services, Dickhens said. They want someone, like Trinity, who can act as a partner and add value and drive performance.
“When you look at what’s going on in the market today, there’s a lot of uncertainty,” he said. “There’s uncertainty on how markets are responding to tariffs and changes in exchange rates and various other political issues.”
Trinity has a comprehensive team that has a lot of experience in these environments and can provide the necessary insight, he said.
Rob Tanenbaum, managing director of strategic partnerships, will lead Trinity Asset Management Services. Craig Lovett, managing director of development, will lead Trinity Development Services. Both will continue to report to Dickhens. It’s a strong leadership team, and under them there are about 45 professionals to assist in both divisions. The company isn’t creating anything new as these expansions are an extension of what it’s doing today with its own portfolio and investors.
The next step is listening to the hotel owners and hearing what their needs are and making the determination whether Trinity can add value on the asset management side and being selective in which hotel owners it works with, Dickhens said.
“We want to work with owners that share the vision that we have and see the value in what we can provide,” he said. “It’s not a shotgun approach. We want to do this very strategically and find investors and owners that we want to work with in the future.”
Another benefit for Trinity in working with other owners is that it can open opportunities to work with them on projects in the future, he said. For a certain property an owner has, that could mean providing capital solutions as well.
“We can inject equity, we can help them on their capital or debt restructuring or recapitalization of the portfolio,” he said. “It all could lead to us doing future projects with them. It’s really a way for us to showcase what we can do as third-party owners.”
Trinity doesn’t do a lot of ground-up hotel development as it’s primarily focused on renovations of existing hotels, Dickhens said. Those projects aren’t simply guestroom renovations. Instead, they are reposition projects that make significant improvements to a property.
“I'd say over the last eight years, we've done $500 million or $600 million worth of capital projects, and currently have about $200 million or $300 million underway, so we were very experienced in that sector,” he said.
At the moment, Trinity has shown incredible progress with its projects, including its JW Desert Ridge Phoenix Resort & Spa and the Grande Lakes Orlando Resort, JW Marriott and Ritz-Carlton properties, he said. The company takes a lot of pride in this and executives believe they can provide the same services to third-party owners, he said.
One of the greatest compliments Dickhens said he ever heard was from Marriott International President and CEO Tony Capuano, who was at the JW Desert Ridge and had done that hotel’s development deal years before.
“After seeing our renovation, [Capuano] said it looks better today than it did originally 20 years ago,” Dickhens said. “That's really hard to achieve in a hotel, but again, we take great pride in that, and that's what we do.”
There’s a lot of pressure on this side of the business, and it requires someone who is hands-on and doesn’t rely on the first bid from a contractor, he said. Though not the same conditions, Trinity has had experience doing major renovations during the pandemic when there were issues with shipping and importing goods.
Hotel owners are facing a lot of pressure from brands to renovate, as well, he said. Many hotel brands gave waivers on capital expenditure projects during the pandemic and its recovery, but now they’re saying it’s time to get back in line with brand standards.
As it moves forward, Trinity will take a measured approach, not adding too many new renovation projects or hotels to its portfolio, Dickhens said.
“I think we’re going to take it relatively slow and make sure we focus on owners again that appreciate what we do and want to build long-term relationships with Trinity,” he said.
Historically, Trinity has worked a lot with big-box, convention-oriented resorts and the like, he said. The team enjoys working on those projects and will look to find third-party owners who could use that expertise.
“We’re also very interested in smaller assets, just depending on the quality of the asset and the individual investor who we’re speaking with,” he said.