Q&A with Robert Thomas of Saltaire Hotels
Saltaire acquires and repositions mid-sized independent hotels in sought-after cultural, coastal and mountain markets, with an emphasis on an authentic sense of place, design quality, and guest experience.
Our primary focus is on formerly owner-operated hotels in front row locations which, through a focus on independent hotels in non-gateway markets, we are able to acquire at high cap rates on historic NOI. Through the introduction of professional marketing (particularly digital marketing), professional management, industry standard accounting practices, targeted property improvements, and comprehensive branding strategies, we are able to grow NOI as well as improve the underlying metrics by which the property is valued.
As hotel developers we observe and applaud the increasing consumer interest in hotels that reflect the local culture. We know the Internet has substantially increased the accessibility and appeal of independent hotels by providing consumers an advance online view of lodging options, without having to rely on chain branding. This shift, in combination with an increasing interest in experience and authenticity, bodes well for the prospects of independent, and particularly experiential hotel properties.
To date Saltaire has successfully executed this strategy with four hotels utilizing friends and family equity capital. We are looking to establish new equity relationships to allow for additional and larger acquisitions.
Join us for a private Family Office Insights Webinar/Teleconference featuring
Saltaire Hotels – bringing new life to forgotten hotels.
December 8th , 2020 • 2:15pm-3:15pm EST
Investors Only Please RSVP REQUIRED HERE
Q&A with Bob Thomas a lifelong real estate and hospitality professionals with a mission to look at each potential hotel acquisition as it could be, not just as it is today.
Family Office Insights is a voluntary, “opt-in” collaborative peer-to-peer community of single family offices, qualified investors and institutional investors. Join the community here www.familyofficeinsights.com
What makes you different from other independent/boutique hotel ownership groups?
Several aspects of our business model differentiate us from our competitors.
We have extremely low overhead, with two non-salaried partners, no employees, and all services handled on an as-needed basis. These include accounting, legal, and third-party feasibility and facilities studies as required per project. Keeping overhead to a bare minimum allows us to focus exclusively on the success of our hotels without having to fund an inflexible internal expense structure.
We are hands-on, with the two partners directing all aspects related to each hotel’s look, feel, market positioning, financial modeling and capitalization. We work closely with, provide direction to, and carefully monitor our third-party hotel manager who handles day-do-day operations. We have found we can purchase third party management services at advantageous pricing relative to running operations internally, while benefitting from our operator’s exclusive focus on hotel operations, synergies with other hotels in the operator’s portfolio, and deep bench of multi-faceted talent.
Lastly, design and marketing programs for our hotels – the look and feel - spring from the architecture and locations of the hotels themselves, avoiding any obsession with the latest fashion, therefore creating a durable aesthetic and market positioning
I keep reading about how hotels are getting hammered as a result of this pandemic. How are your hotels faring?
We are doing better than most hotels, in that our hotels have been self-sustaining and have not required cash infusions from our investors. This position results from several factors. These include that our hotels are in drive-to, affluent markets, are very much focused on lodging and do not have expensive to operate food and beverage and resort facilities, are not highly leveraged, and our policy of borrowing from local lenders with whom we develop a relationship and who have provided relief. All of which puts us in a strong position when we emerge from the pandemic.
What locations do you focus on and wish to continue to pursue?
We are focused on coastal, mountain and cultural locations sharing some of the following attributes:
- High barrier to entry market – especially resulting from zoning and other local controls
- Availability of well-located currently owner-operated motels/hotels suitable for repositioning to match the taste of the visitor demographic
- Lack of well-managed, experiential upper-middle tier options matching the tastes of the visitor demographic
- Strong sense of local character: distinctive history, culture, and/ or geography
- Affluent and sophisticated demographic with an affinity for arts and design
We avoid low cap rate environments, for example gateway cities. We prefer leisure and tertiary markets where hotels can be acquired at high cap rates relative to historical NOI, where we can be immediately profitable and not strained by the risk of high acquisition pricing
Robert Thomas of Saltaire Hotels
Prior to his work in hospitality, Bob has developed adaptive re-use and new construction housing and mixed-use projects in the New York and Boston areas. Bob also consulted for a Miami bank to evaluate distressed commercial real estate loans.
As Project Manager at a New York based restoration consulting and contracting company, he designed and implemented restoration plans for many major historic buildings and monuments, including New York City’s Grand Central Terminal, the Annapolis Naval Academy Chapel, and the Minnesota State Capital.
Bob received an M.S. in Historic Preservation from Columbia University in New York City, and his undergraduate degree from Colby College in Waterville, ME
Prior to her work in hospitality, Dierdre developed over 200 residential units in Boston and Cambridge.
Dierdre also has national banking experience managing portfolios of nonperforming commercial estate loans resulting in significant recoveries.
Dierdre received a B.A. from the University of Delaware and an M.A. in Historic Preservation from Boston University.