SCOTTSDALE, Arizona—When Jared Chandler first started his own commercial real estate business 13 years ago, he had no idea what it would evolve into—a hotel company that brokers, manages, constructs and designs hotels.
“I always knew I wanted to get into commercial real estate, but I never had a singular focus on hotels,” said Chandler, president and CEO of Chandler Hotel Group. It was Chandler’s mentor who steered him in the hotel direction, and from there his passion only grew, he said.
A self-proclaimed solution-oriented guy, Chandler likened his experiences with commercial real estate to a chess game because there’s always a lot of moving pieces, especially when you deal with franchise companies, he said.
“I started an interior purchasing and design division, and then it evolved into a construction team to help mitigate, if not completely keep from buyers and sellers re-trading once they were in escrow. Then I got into the management side of the business because it’s always been my vision and dream to be an owner as well,” Chandler continued.
Chandler added the management arm at his company in 2007, and it has been a focus since. Chandler Hotel Group has 15 properties in its management portfolio, according to COO Shannon Kaufman, and plans to add another half dozen within the next two to four months.
Kaufman said the company is looking to manage focus-service hotels, boutique hotels and full-service hotels in several markets including, but not limited to, Texas, the Midwest and Canada.
Piggybacking off Kaufman’s choice markets, Chandler said he’d love to get into Sedona, Arizona, or Santa Barbara, California, with an independent property.
“These are the high barriers-to-entry markets. To do something special and unique, that’d be a dream,” Chandler said.
Management philosophy
Transparency is most important when it comes to managing a property, Kaufman said.
She said it starts with giving owners all the necessary tools.
“If you’re doing something great, the owner needs to know. If there’s something that’s going to cause an issue, they also need to know that. What I’m finding is that being in this (field) a lot of management companies are spoon feeding information,” she said.
Kaufman added that she takes a more “grass roots” approach to management.
“Never forget where you came from,” she said. “It’s important that the owners understand that I can still make a bed and I can still check a guest in, and I will train them on that.”
Because Chandler Hotel Group also brokers properties, Kaufman said she gets a lot of feeder business.
“If a broker is selling a hotel for a new owner, and the new owner is looking for new management, we could be a part of that,” she said. “If there’s a (property improvement plan), they’ll also sell the management arm. We try to feed each other business all the time.”
In addition, Chandler’s reputation with major brands such as Hilton Worldwide Holdings and InterContinental Hotels Group has helped the company nab management contracts, Kaufman said.
“The sky isn’t always blue,” she said. “But our reputation is getting us places.”
In the future, Chandler said he hopes to get into the development business with Marriott International.
Buy, build and sell strategy
Chandler Hotel Group does everything in house, so it makes for an easier deal-negotiation process, Chandler said.
For example, having a construction team on hand helps the company turn around PIP estimates more quickly, limiting time spent looking for contracts, he said.
On the buy and sell side, Chandler said he’s seen a significant increase in what he calls a “normal market,” which means buyers and sellers are not in desperate situations, so they’re finding ways to add value to existing properties.
“Sellers were able to sustain over the last five to six years, and now they’ve settled in,” Chandler said. “Now it’s more of either a deleverage (situation) for them or they’re retiring and reorganizing profits.”
Chandler said his company is adding value, or renovating, several properties along the east and west coasts. His construction arm CHG Construction last year was the recipient of the IHG “Renovation of the year” award for the Holiday Inn Express in Tempe, Arizona.