Practice/Industry Group Overview
Sutherland is where hospitality checks in for help navigating global development and business growth no matter how hospitable the economic climate.
Sutherland helps leisure clients grow their business, despite the hospitality industry being especially susceptible to economic cycles. We know ADR, REVPAR and REVPAR Index and what it takes for our clients to keep heads in beds while navigating the complexities of global development. Leisure and business travel present challenges—both are subject to dynamic changes in hotel supply, operating cost pressures, changing demographics, shifting international travel patterns, online distribution costs, recruitment and retention challenges, emerging market issues and increased international branding and development. Sutherland is ideally suited to help hospitality and leisure clients thrive as they manage these realities. Our attorneys—including former in-house leaders from major ownership, management and branding companies—represent leading hotel and resort owners, operators, managers, developers, franchisors and lenders throughout the world. Our hospitality practice has a particular focus on global growth by expansion and acquisition.
Hospitality clients benefit from Sutherland’s interdisciplinary approach, which includes intelligence from hospitality, franchise, management, real estate, operations, trademark, intellectual property, information technology, outsourcing, construction, tax, bankruptcy, employment and litigation lawyers. We help our clients quickly navigate opportunities and issues with a talented team that knows the industry. We understand hotel management and operations, sales, multibillion dollar mergers, acquisitions and joint ventures; private financing transactions; franchising arrangements; global procurement; and multi-brand global franchising and management. In addition, we have experience with every major provider of technology and e-commerce services and products. We guide clients through solid, cost-effective, high-return deals for online distribution, licensing, development and outsourcing of property management systems, central reservation systems, revenue management systems, high speed internet access, telecommunications, in-room entertainment systems and more, as well as transitions between systems and multiyear global deployment projects at hotels around the world.
We provide substantial skill in distressed situations, including distressed hotel projects; foreclosures, deeds in lieu of foreclosure and other court receivership actions; sales of loans and real estate owned properties acquired by foreclosure or in deed in lieu of foreclosure; purchase and sale transactions in state insolvency proceedings and federal bankruptcy cases; lender comfort letters; and real estate and Uniform Commercial Code liquidations. We structure and document both domestic and cross-border workout arrangements; advise creditors of troubled projects; counsel hotel lenders, their borrowers, managers and investors; and represent special servicers and providers of debt, mezzanine and equity capital with respect to non-performing securitized hotel loans, collateralized debt obligations and collateralized loan obligations.
Hospitality and leisure depth. We deliver the legal know-how our hospitality partners require, including information technology, e-commerce, hotel operations, online distribution, real estate, tax, finance, M&A and joint ventures, intellectual property, construction litigation, environmental, foreclosure and bankruptcy, compliance, internal and external investigations, incident response and crisis management, and franchise and management contracting globally.
Former in-house counsel. Our team members have substantial in-house experience with leading U.S. hotel ownership, management, franchise and branding companies. We know what matters most to our clients and all the different interests that make things happen expeditiously in the internal environment.
Industry-leading client base. Our attorneys know the legal and business issues and alternatives, and all the players, related to franchise and management agreements, for Marriott, Hilton, Hyatt, Sheraton, Ritz-Carlton, Millennium, Baccarat Hotels & Residences, Candlewood Suites, Doubletree, Four Seasons, Hampton Inns, Mandarin Oriental, “1” Hotels & Residences, Ritz-Carlton, Sheraton, Westin, and Wyndham.
Fast and efficient. Intense time pressures often accompany hospitality real estate and finance deals and acquisitions and joint ventures. We strive to beat, not just meet, deadlines. We pride ourselves on our dealmaking attitude and ability to work with all parties, including opposing counsel, in a non-adversarial, cooperative manner.
Creative and cost-effective. We take pride in the creativity we bring to this practice, as evidenced by the challenges we have innovatively addressed for our clients large and small.
Nuts and Bolts
- Hospitality industry
- We negotiate management and franchise agreements with most major hotel chains, including those operating in the United States, Canada and South America. We understand all aspects of hotel finance and are familiar with the accounting issues unique to hotels. Our hospitality and real estate lawyers work with hotel acquisitions and dispositions, operations, development, bankruptcies and workouts.
- Global development and operations
- Sutherland lawyers represent hotel and resort developers, owners, operators, managers, franchisors, franchisees and lenders in projects throughout the world.
- Hotel development and repositioning
- Development and repositioning of hotels and resorts present a unique set of challenges. .For many projects, a complex arrangement of public/private cooperation is the key to success.
- Troubled hotel projects
- We counsel on agreements that minimize the risks and provide a path for seeing a project through difficult times. Sutherland attorneys from a number of practice areas, including real estate, finance, bankruptcy and litigation, have substantial experience with distressed hotel projects.
- Foreclosure, bankruptcy and workouts
- We handle all aspects of bankruptcy reorganizations, including issues related to the use and sale of collateral and the protection of rental income.
- Partnerships and partnership taxation
- We have formed partnerships, limited liability companies and joint ventures to own and operate real estate; guided the documentation and enforcement of inter-partner loans and the exercise of put/call provisions.
- Environmental issues
- In connection with both acquisitions and financings, we assist our clients in obtaining and reviewing environmental site assessments and evaluating recommendations for remedial work. We regularly represent hotel companies and developers in connection with investment and management opportunities throughout the world.
- Real estate
- Sutherland has approximately 30 real estate lawyers. We assist clients in responding to both the challenges and opportunities of the real estate industry, often through innovative and sophisticated approaches that lead to practical and cost-effective solutions.
- Real estate finance
- We advise both lenders and borrowers in connection with all types of hospitality financing, including construction and permanent loans, multistate financings, leasehold financings, sale/leaseback transactions, mezzanine loans, short-term variable rate financings, participating mortgages and subordinate and wrap-around financings.
- Acquisition and development
- We are experienced in all phases of the acquisition and development process, from negotiation of letters of intent and purchase and sale agreements through project completion and permanent financing.
- International transactions
- We work regularly on foreign investment in United States hospitality properties, as well as large scale development abroad by foreign and domestic clients.
- Pension fund investments
- We represent a significant number of pension funds and insurance companies that act as investment advisers and managers for pension funds in connection with real estate investments by those entities.
- We are an industry leader in federal, state and local tax questions and bring that leadership to tax aspects of hospitality transactions and hotel operations. We have extensive experience with occupancy tax and related questions, including application to online transactions.
- Our lawyers have spent decades addressing antitrust aspects of hotel operations on a global scale, including antitrust training and compliance, sales questions, relations with competitors, formation of joint ventures with competitors, franchise sales, procurement and brand standards, and online distribution requirements. We have worked with every major hotel company, joint venture and third party intermediary.
Successful hospitality projects require a legal team that understands the unique characteristics of the leisure, travel, service, e-commerce, franchise, real estate and finance industries. Sutherland’s exceptional hospitality experience and stellar cross-practice team provide the best possible outcomes for hotel and resort developers, owners, operators, franchisors, franchisees, lenders, and investors in hospitality projects throughout the world.
Sutherland advises a hotel investment advisory and asset management client in the proposed formation of a joint venture to acquire distressed hotels.
Sutherland advises a hospitality industry investment advisory firm and asset management client regarding a joint venture to acquire distressed hotel properties.
Sutherland advises international hotel operating company and brand owner in merger.
When three hotel groups merged in a multimillion dollar deal, Sutherland worked to structure the most tax-efficient transaction.
Sutherland serves as primary outside counsel for Hilton Worldwide, Inc.
Providing counsel on a broad range of issues and operations, Sutherland serves as primary outside counsel to Hilton Worldwide.