Negotiating Hotel Purchase and Sale Transactions: Key Legal Issues for Buyers and Sellers
Closing Contingencies and Reps and Warranties; Evaluating Existing Management and Franchise Agreements

Course Details
- smart_display Format
On-Demand
- signal_cellular_alt Difficulty Level
Intermediate
- work Practice Area
Real Property - Transactions
- event Date
Thursday, June 27, 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 discuss the critical legal issues in purchasing and selling a hotel property, considering the unique aspects of this asset class. The program will focus on seller representations and warranties, key contract provisions in the purchase and sale agreement, and retention or termination of the hotel management/franchise affiliation. The program will also address the significance of the terms of the hotel management agreement.
Faculty

Mr. Robins works on a broad variety of hotel and resort development, operations and regulatory matters, including the evaluation of litigation. Andy is recognized nationally as a leading authority on the development and structuring of mixed-use real estate projects throughout the United States and globally. Clients turn to Mr. Robins for his depth and scope of experience and his practical approach to addressing the material risks and potential rewards of complex matters within the hospitality sector. He counsels lodging and lifestyle companies on evolving products and works regularly with established and startup branding companies within the hospitality sector. Additionally, Mr. Robins advises capital providers on loan restructurings and REO. He is a frequent speaker on hotel and resort development and operations.

Ms. Goeddel represents owners, lenders and hotel companies in commercial real estate transactions and has a special expertise in complex resort and hospitality development projects. Her clients' projects are within urban and resort locations, throughout the U.S. and in foreign jurisdictions, with specific emphasis on North America, Latin America, the Caribbean and Asia. Ms. Goeddel has 20 years' experience representing clients in all types and all phases of real estate projects, including acquisition and disposition; finance; development, including creation and implementation of mixed‐use legal structures preparation of project governing documents, residential sale documents and project registrations; negotiation of management and related agreements; and post‐completion operations. In addition, Ms. Goeddel has specific experience in the purchase and sale of hotels and resorts and representing owners and lenders in connection with distressed hotels and residential projects.

Ms. Zeidel’s focus on all sectors of commercial real estate and hospitality, including hotels, restaurants, and bars. She is retained by national, regional, and local companies to handle development, sales, acquisitions, and leasing deals, as well as agreements with architecture firms, construction companies, and other vendors. Ms. Zeidel also regularly crafts and negotiates hotel management, franchise, and branding agreements, as well as operating agreements for food and beverage, spas, and other hotel amenities. Prior to establishing the firm, Ms. Zeidel served as Assistant General Counsel at Fortune 500 global hospitality company Starwood Hotels & Resorts Worldwide, which was subsequently acquired by Marriott International. At the time, the company owned, managed and franchised more than 1,000 hotels worldwide under the brands Sheraton, Westin, W, St. Regis, The Luxury Collection, Le Méridien, Four Points by Sheraton, Aloft, and Element.
Description
Purchasing a hotel or other resort/leisure property is fraught with legal issues beyond real estate matters. Working knowledge of the concerns, standards, and customs for addressing those matters is critical to a successful transaction.
The buyer and seller must ensure that the purchase and sale agreement provides a sufficient roadmap through the acquisition and disposition process that considers all stakeholders and meets the parties' reasonable expectations. A group of reps and warranties is not enough.
Key provisions may include the buyer's ability to obtain or assume financing; retaining or terminating the franchise affiliation; retaining or terminating the management agreement; the buyer's ability to secure required licenses and permits (including a liquor license); development of a property improvement plan; addressing employment concerns; evaluating potential organized labor agreements; withdrawal liability under ERISA; evaluation of existing leases and service contracts; and other due diligence items.
When the hotel property is subject to a hotel management agreement or a franchise affiliation, buyer's and seller's counsel must vet the buyer's ability to retain or terminate that relationship. The hotel management agreement can lock in much of the hotel's value. The buyer must carefully examine the management agreement and the abilities of the hotel management staff.
Listen as our authoritative panel discusses unique issues involved in the purchase or sale of a hotel. The discussion will include seller representations and warranties, critical closing contingencies in the purchase and sale agreement, and issues to consider in the retention or termination of the hotel management/franchise affiliation.
Outline
- Seller representations and warranties in the purchase and sale agreement
- Closing contingencies in the purchase and sale agreement
- Retaining or terminating the hotel management/franchise affiliation
- Vetting the hotel management or franchise agreement
Benefits
The panel will review these and other key issues:
- Why are seller representations and warranties so critical in purchasing a hotel property?
- What issues require focus and attention and need to be resolved in the purchase agreement?
- What are the unique issues involved in the purchase of hotel property to include in the purchase and sale agreement's closing contingencies?
- What issues will the hotel management or franchise agreement address concerning the purchase and sale?
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