Hospitality Lawyer: China. I had no sooner posted my last entry on our expert panel’s views for Outlook 2007 as it relates to international markets when I read an update as of December 6, 2007 that Barry Sternlicht and Starwood capital have increased their bet on China! And of course, this comes after a huge investment in India as we discussed in “Hospitality Lawyer: Sternlicht and Starwood Capital to put $500 million in India for Crillon, ‘1’ Hotels and Residences and budget hotel chain, Campanile.”

Tom Corcoran, CEO of FelCor, nailed it when he said in today’s posting, “When you talk about hot markets, you’d have to say, China, China, China… and India.”

Here are the details on the Sternlicht/Starwood investment in China.

TheStreet.com reported today that Barry Sternlicht’s Starwood Capital entered a strategic relationship with Shanghai Jin Jiang International Hotels, one of China’s largest hotel operators.

Starwood Capital will make a $30 million strategic investment in Jin Jiang. This will make Starwood the largest outside-shareholder in the company. Starwood and Jin Jiang will work together to develop and strengthen each other’s hotel business, mainly in China, and will cooperate on hotel business projects.

“Starwood Capital is very excited about the potential for Jin Jiang in China and abroad, and for our future partnership together,” said Sternlicht, who built the Starwood Hotels chain into a major industry player before stepping aside last year. Starwood Capital isn’t related to the publicly traded company.

“Jin Jiang’s geographic reach and portfolio of owned assets across all hotel categories leaves it uniquely positioned to benefit from the explosive growth in the Chinese hotel industry, fueled by rapidly expanding tourism and business travel,” Sternlicht said. “By combining Jin Jiang’s portfolio, which features irreplaceable hotels in Shanghai and other major Chinese cities, with our track record of creating global brands and enhancing asset value in both the luxury and budget categories, the partnership has the potential to create significant value for both companies going forward.”

Our Perspective. We represent developers, owners and lenders. We have helped our clients as business and legal advisors on more than 85 hotel-enhanced mixed-use projects, all of which have at least a significant condo hotel element. These deals are in every major market in the U.S., as well as Latin America and Europe. They are a part of our $40 billion of hotel transactional experience involving more than 1,000 properties all over the world. For more information, please contact Jim Butler at [email protected] or 310.201.3526.

About the Author:

Jim Butler is recognized as one of the top hotel lawyers in the world. He devotes 100% of his practice to hospitality, representing hotel owners, developers and lenders. Jim leads JMBM’s Global Hospitality Group® –– a team of 50 seasoned professionals with more than $40 billion of hotel transactional experience, involving more than 1,000 properties located around the globe. Jim sees the condo hotel phenomenon as just one part of the long-term trend toward "hotel-enhanced mixed-use" where hotels work together with shopping center, residential, office, retail, spa and sports facility components to mutually enhance the entire project's excitement and success.

Jim and his team are more than "just" great hotel lawyers. They are also hospitality consultants and business advisors. They are deal makers. They can help find the right operator or capital provider. They know who to call and how to reach them. They are a major gateway of hotel finance, facilitating the flow of capital with their legal skill, hospitality industry knowledge and ability to find the right "fit" for all parts of the capital stack. Because they are part of the very fabric of the hotel industry, they are able to help clients identify key business goals, assemble the right team, strategize the approach to optimize value and then get the deal done.

Jim Butler
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