Hospitality Lawg

Hospitality Lawg

Commentary on Hospitality Law and Developments

Category Archives: Finance

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Worthy Read – ARDA’s Survey of HOA Controlled Timeshare Resorts

Posted in Finance, Management, Shared Ownership
The ARDA International Foundation has recently released an interesting study focused exclusively on resorts controlled by home owner associations.  The three academics behind this first-of-its-kind report were looking to “identify those factors that effectively contribute to success or failure in HOA controlled resorts.”    The survey focused on the following broad topics for this important … Continue Reading

Colorado Breaks New Ground – Timeshare Relief Company Regulation

Posted in Finance, Management, Shared Ownership
Last week, Representative Carole Murray introduced HB 12-1116, which has the title “Concerning Deceptive Trade Practices Related to Timeshare Resale Transactions.” With respect to regulation of the traditional resale business, the Colorado bill is similar to the Florida timeshare resale bill that we discussed in a prior post (but thankfully without Florida’s “ratio” disclosure requirement).  However, the Colorado … Continue Reading

Hospitality Investment – Accredited Investor Rules Amended

Posted in Finance, Hotel, Shared Ownership
Time to revise your form investment documents – as of February 27, 2012, the Securities and Exchange Commission’s new accredited investor rule will take effect.  Affirming accredited investor status is crucial in determining whether an investment falls under the Regulation D safe harbors and qualifies for exemption from some of the more onerous and expensive disclosure obligations otherwise required … Continue Reading

EB-5 Visas – Impact of Proposed Policy Memorandum and VISIT-USA Act

Posted in Finance, Hotel, Shared Ownership
As we reported previously, the EB-5 visa program has drawn the interest of hospitality developers looking for alternative financing mechanisms.  While there doesn’t appear to have been much activity on SB 642, which would make the EB-5 Regional Center Program permanent, there have been a couple interesting developments in this area over the past few … Continue Reading

Trump Settles Condotel Securities Lawsuit

Posted in Finance, Hotel
Back in March, the Hospitality Lawg took its first look at the securities litigation surrounding the Trump SoHo, a New York condominium hotel.  The plaintiffs’ primary beef was that they had bought under the impression that 60% of the units were sold, when at the time the developers had closed on just 16% of the … Continue Reading

BFC Financial to Acquire Bluegreen

Posted in Finance, Shared Ownership
Monday was a big day at Bluegreen Corporation (NYSE: BXG).  Reporting its third quarter financial results, the company reported a third-quarter profit of $7.1 million, or 22 cents per share, compared with a loss of $16.7 million, or 54 cents per share, for the same quarter last year.  But that turnaround wasn’t the big news … Continue Reading

Spin-Off of Marriott Vacations Worldwide Approved

Posted in Finance, Hotel
Marriott International, Inc. (NYSE:MAR) announced the approval of the spin-off of Marriott Vacations Worldwide Corporation through the distribution of shares to holders of Marriott International common stock.  As discussed in our prior posts, Marriott Vacations Worldwide will become the market’s largest pure-play timeshare company.  Details from the press release include the following:  Marriott Vacations Worldwide … Continue Reading

Hospitality Industry Growing Local Economies: Benefits of Resort Development and Environmental Preservation in Jericoacoara, Brazil

Posted in Construction, Finance, Hotel, International
When I first visited Jericoacoara in 2002, hotel development and international tourism were just starting to boom. The Brazilian government had recently designated the surrounding landscape as a national park, protected from development and limited in use. Located about 200 miles from the city of Fortaleza on the northeast coast of Brazil, Jericoacoara was originally a … Continue Reading

Tarsadia Hotels Counters SEC Policy Arguments

Posted in Finance, Hotel
Back in August, we filed a post briefly outlining the SEC’s policy arguments as to why the purchase of a unit at a San Diego condo-tel constituted an investment contract for purposes of the federal securities laws.  For the reasons outlined here, we found it curious that the SEC would choose to advance its concerns … Continue Reading

Speaking of Maintenance Fees . . .

Posted in Finance, Management, Shared Ownership
The September issue of Developments Magazine features an article titled Rx For Your Fiscal Health – Annual Checkup on Your Resorts and HOAs.  In putting the story together, Geri Bain interviewed Kurt Gruber, Baker Hostetler partner and Hospitality Lawg Editor.  Although the article provides insights from a host of industry professionals, we are republishing here Kurt’s comments … Continue Reading

Marriott Vacations Worldwide Puts Big Names on Future Board of Directors

Posted in Finance, Shared Ownership
The creation of the world’s largest pure-play shared ownership company is big news for the hospitality industry.  So we are keeping a close eye on the spin-off of Marriott Vacations Worldwide.  Yesterday, another important step was taken when it was announced that the following individuals had agreed to serve on the Board of Directors for … Continue Reading

CFPB Goes Live – What’s Next Is Anyone’s Guess

Posted in Construction, Finance, Management, Shared Ownership
Given its scope of authority, we have been providing hospitality companies with a semi-regular update on the Consumer Financial Protection Bureau. Today, the CFPB goes live with a nominated, but far from confirmed, director.  President Obama named Richard Cordray as his choice to lead the Consumer Financial Protection Bureau last Sunday evening.  Although we provided … Continue Reading

Four Years in a Row – Chambers USA Recognizes Baker Hostetler as a Top Hospitality Law Firm

Posted in Construction, Finance, Hotel, International, Management, Shared Ownership
We would like to thank our friends and clients who responded to the most recent Chambers survey.  For those not familiar with Chambers, its intensive and unbiased survey methods make it the most respected legal directory available.    Based on the strength of comments Chambers received, Baker Hostetler was, for the 4th year in a row, recognized as having one … Continue Reading

Salameh v. Tarsadia Hotels – Plaintiffs Strike Out On Condo-tel Securities Claim

Posted in Finance, Hotel
Salameh v. Tarsadia Hotels documents yet another instance of buyers’ remorse.  Like most “condo-hotel units are securities” litigation, the plaintiffs in this case were looking to discredit the developer’s sales practices and operational model as a means of rescinding their unit purchases.  And like many other similar claims, the plaintiffs’ claims didn’t survive a motion to … Continue Reading

Consumer Financial Protection Bureau Stakes Out Turf (Kind Of)

Posted in Finance, Hotel, Management, Shared Ownership
Why does the Consumer Financial Protection Bureau Matter? The Dodd-Frank Wall Street Reform and Consumer Protection Act created the Consumer Financial Protection Bureau, a new and powerful federal bureaucracy with a mandate to enhance consumer financial protection under a host of new and existing consumer protection laws.  According to the current schedule, the CFPB will absorb a … Continue Reading

Trump SoHo: An Initial Look at the Securities Law Claims

Posted in Finance, Hotel
Back in November, Craig Karmin of the Wall Street Journal reported that the developers of Trump SoHo were offering disgruntled condo buyers up to half their deposits back, on the condition that they not join the lawsuit alleging, among other things, that the Trump SoHo developers violated securities laws in the marketing of the project.  Not … Continue Reading

Consumer Financial Protection Bureau Update

Posted in Finance, Shared Ownership
Why does the Consumer Financial Protection Bureau Matter? The Dodd-Frank Wall Street Reform and Consumer Protection Act created the Consumer Financial Protection Bureau, a new and powerful federal bureaucracy with a mandate to enhance consumer financial protection under a host of new and existing consumer protection laws.  According to the current schedule, the CFPB will absorb a … Continue Reading

Marriott Timeshare Spinoff

Posted in Finance, Hotel, Shared Ownership
The Spinoff Under a plan announced Monday, Marriott International will spin off its timeshare business to its existing shareholders.  The deal, which is expected to happen by the end of the year, has the potential to create one of the world’s largest standalone timeshare businesses, with around 71 properties, 33,000 rooms, 400,000 owners and $1.5 … Continue Reading

EB-5: A Development Funding Alternative?

Posted in Finance, Hotel, Shared Ownership
While the hospitality industry seems to be rebounding, financing for new hotel and shared ownership projects is still not easy to come by.  That’s why Eliot Brown’s recent article in the Wall Street Journal caught my eye.  The EB-5 Program (a/k/a “The Million Dollar Green Card”) WSJ reporters Brown and Lynnette Khalfani-Cox aren’t the only ones who … Continue Reading

Private Placement Rules Updated

Posted in Finance
The available pool of equity investors may have decreased for developers and other parties in the hospitality industry looking to raise equity.  Section 413 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, among a myraid of other things too numerous to list, modified the definition of an “accredited investor” to exclude the value of … Continue Reading