Hotel Management Agreements: Navigating Fees, Exclusivity, Approval Rights, Finance Provisions, Brand Management
Course Details
- smart_display Format
On-Demand
- signal_cellular_alt Difficulty Level
Intermediate
- work Practice Area
Real Property - Finance
- event Date
Tuesday, November 12, 2024
- schedule Time
1:00 p.m. ET./10:00 a.m. PT
- timer Program Length
90 minutes
-
This 90-minute webinar is eligible in most states for 1.5 CLE credits.
This CLE course will cover topics of central importance to counsel preparing or reviewing hotel management agreements from a range of perspectives--whether as counsel to the owner, operator, lender, or potential acquirer.
Mr. Blount is an experienced transactional member, who specializes in representing owners, developers, and managers of (and investors in) hotels, resorts, food and beverage venues, and mixed-use projects. Over the years, he has worked on a broad range of hospitality matters across the United States and on a global basis, including for projects in Bhutan, Fiji, France, India, Indonesia, Portugal and Spain. Mr. Blount has extensive knowledge in negotiating hotel brand management agreements and joint venture agreements. He also regularly represents buyers and sellers of hotels and resorts, including through debt acquisitions and restructurings.
In addition to a national commercial real estate practice, Ms. McCarthy has advised owners, investors and hotel companies with respect to sophisticated hospitality transactions for nearly two decades. This focus includes hotel acquisitions and dispositions, hotel development and finance, mixed-use development projects, hotel management agreements, branded residential projects, restaurant and spa agreements, hotel joint venture agreements and general hotel operation matters throughout the U.S. and the Caribbean. Through this experience, Ms. McCarthy has developed insight and an understanding of the legal intricacies that affect the hospitality industry.
In the world of hotel company M&As and IPOs, the perception is that hotel management agreements are annuities for operators and a yoke for owners to endure. How does the traditional perception square with how lawyers think through and negotiate management agreements on behalf of owners and operators?
Understanding the particulars of hotel management agreements is essential to gauging hotel value and hotel financing. Whether representing owners or operators, counsel must understand the dynamic that gives rise to the incentives embodied in a hotel management agreement and how case law impacts an owner's ability to terminate a management agreement.
Listen as our authoritative panel analyzes evolving trends in hotel management agreements and critical terms such as duration, exclusivity, termination, and finance provisions. The panel will discuss the core topics and will impart best practices for negotiating the agreement.
- The base fee, the incentive fees, and all those other charges
- Key money
- Financing: lender hot buttons
- Approval rights every owner should have
- Performance tests: make it meaningful
- The brand management agreement: technical services and pre-opening agreements
The panel will review these and other key issues:
- How can counsel best balance incentives for owners and operators?
- How are the fees structured to achieve the objectives of both parties?
- How do counsel for lenders think through management agreement risks?
- What kinds of criteria are most relevant for gauging performance?
- How might one-off purchasers and portfolio purchasers in leveraged buyouts conduct due diligence of in-place hotel management agreements?
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