Hospitality Industry

"...a dominant presence …and represents major brands in their national and international interests. Sources note the team's strengths in mixed-use projects..."

– Chambers USA 2012

BakerHostetler's Hospitality team counsels the world's leading hotel and resort companies and helps them drive value in their most ambitious and creative projects across the U.S. and around the globe.

Chambers USA 2013 ranks our team as one of the nation’s top leisure and hospitality practices. We are cited in particular for Commercial Awareness, with a client noting, "All that a law firm brings to the table they do, but what they do in addition is provide business counsel through a legal lens." – Chambers USA 2012

We are particularly well known as a go-to team for counsel on mixed-use projects, such as resort hotels integrated with timeshare, fractional, condominium, branded residential, casino, marina or golf components. Our thirty years’ experience with complex transactions enables us to develop creative solutions to managerial, tax, ownership, and financing challenges. We are one of few firms with such top level depth and experience in both hotel and shared ownership project development.

Cutting-edge mixed-use resort projects today can be virtual cities unto themselves. We know how to structure a deal so that the various components and stakeholders work together seamlessly in an integrated community.

We regularly advise clients on hotel and resort management and operational matters, including hotel management agreements, franchise agreements, hotel labor and employment matters, ADA compliance, and issues with owners’ associations.

We are also well known for our work in the development of a wide variety of timeshare and fractional ownership products and have been deeply engaged in legislation affecting the timeshare industry in Florida and many other states.

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Understanding Specialized Product Types

Our Hospitality Industry team works with companies focused on creating innovative leisure experiences for their guests. During the past three decades, we have assisted clients who were on the cutting edge of resort development, management, operations and financing. As the hospitality marketplace has become more sophisticated, we have provided advice and counsel on fractional ownership programs, mixed-use condominiums, country clubs and condominium-hotels. Here is just a sampling of our experience in key market segments:

Hotels

We represent a number of major hotel owners, management companies and franchisors in their acquisition, development, managing and branding of hotel properties, and the drafting and negotiation of related purchase and sale, management, franchising, financing and joint venture agreements. We have considerable experience in hotel acquisition and financing transactions, particularly those involving mixed-use resort properties both in the United States and internationally. In our representation of buyers and sellers of hotels, we are well-versed in the complex financing of major hotels and resorts and the issues unique to hotel properties.

Timeshare and Fractional Resorts

We have assisted clients in the development of a wide variety of timeshare and fractional ownership products—from fixed-week, single-site projects to point-based, multi-site vacation clubs. Our experience includes state registration of timeshare and fractional programs, advising clients on sales and marketing issues, consumer financing and resort management and negotiation of relationships with exchange companies. We have also participated in the drafting and adoption of every Florida statutory amendment and administrative rule affecting the timeshare industry since 1983. We have been active in major legislative efforts related to the timeshare industry in Arizona, the Bahamas, California, Colorado, Illinois, Maryland, Nevada, New York, Puerto Rico, South Carolina, and Texas—including our service as lead drafter of the new California timeshare law. Our experience has aided us in developing relationships with regulators in jurisdictions throughout the nation and internationally.

Communities

Our team assists developers in creating community associations and structures that address the specific needs and goals of their particular projects. We work with the development team to determine the best mechanism for handling:

  • Community administration and governance
  • Maximization of developer flexibility and control
  • Integration of unique aspects of the community
  • Facilitation of competing interests
  • Preservation of common areas and amenities
  • Creation of mechanisms for enforcement of community-wide standards through regulation of maintenance, architecture and use

We counsel the developer on marketing, developmental decisions, and use issues that ultimately are woven into the project's documents. Once these decisions are made, we prepare the project's governing documents, which typically include a declaration of covenants, conditions, and restrictions, as well as the articles of incorporation and bylaws for the community association. Our experience in the various phases of development, contemplating Community Development Districts, governance issues, and the unique issues that are present in large mixed-use communities provides developer clients with innovative and cutting-edge advice to advance their objectives.

Personal Property Timeshare

When a client's project includes cruise ships, yachts, boats, recreational vehicles, automobiles or planes, we call upon our broad array of experience advising developers on creation of ownership and use regimes for such personal property. In addition, that experience is bolstered by our team's heavy participation in related legislative matters. A member of our team chaired American Resort Development Association's (ARDA) Personal Property Timeshare Task Force and led the drafting of the model regulations for personal property timeshare. In addition, we were hired to draft the amendments to Florida's Timeshare Act to permit personal property timesharing. Our knowledge and expertise with the various approaches to developing a personal property timeshare plan—or to including a personal property component in a timeshare regime—can help clients avoid the common pitfalls and errors that are possible in this burgeoning new market.

Condominium-Hotels

Condominium-hotels—whether newly constructed or converted from an existing hotel—are complex projects that require careful planning. Our experience ranges from projects designed as “second homes” where owners participate in a rental program, to development of properties where ownership is structured like a condominium but the appearance, amenities, and operation are identical to a single-owner hotel. We have worked with developers on strategies to maximize owner participation in a rental program without having the project classified as a security for state and federal securities law purposes. We also provide in-depth training for the real estate sales force and management team to help the developer abide by securities and condominium laws. Our attorneys have strong experience advising clients on complex zoning and land use issues that can affect conversion of existing hotel properties to condominium-hotels.

Golf and Country Clubs

The firm has considerable knowledge and experience in representing golf and country club owners in their acquisition, disposition, development and management of golf and country clubs. Our attorneys prepare and negotiate the documentation needed to buy, sell, develop, and/or manage golf and country clubs including purchase and sale agreements, management agreements, easement agreements, maintenance agreements, financing documents, employment agreements, operating agreements, and other ancillary documentation.

We counsel owners and/or managers of golf and country clubs regarding issues that may affect membership and then assist in the preparation of club documents, such as membership agreements, membership applications, club rules and regulations, and membership financing documents. In addition, our attorneys are experienced in advising clients on matters related to the acquisition and development of a golf and country club, which may include zoning and land use issues, environmental assessments, employment issues, and ADA requirements and assessments.

Comprehensive Counsel for Project Acquisition and Development
Resort Property Acquisition and Construction

We assist clients in all facets of hotel and resort acquisition, disposition and development, including environmental, construction, permitting, land use, local regulatory, and zoning issues. Our attorneys provide experienced, hands-on counsel in the preparation of construction contracts and advise clients on current construction law issues in numerous jurisdictions.

Financing and Securities Advice

We offer in-depth counsel on the structuring of real estate investments, including proper tax planning. Our firm counsels several Real Estate Investment Trusts (REITs), and we offer guidance on the formation of joint ventures, raising capital and buying or selling hospitality-related companies. A number of our lawyers have substantial experience in hotel and resort financing, including acquisition and construction loans, hypothecation loans, receivables securitizations, and regulatory issues pertaining to finance transactions. Our experience with capital market transactions allows us to assist clients seeking access to those lenders to finance their hotel or resort projects.

Product Creation, Structuring and Registration

As a national firm, we have assisted with product creation and registration in nearly every state as well as in a number of international locations. Since our attorneys have counseled first-time and up-and-coming developers as well as many of the major players in the industry, we are comfortable advising clients at all levels of experience. We work with clients from the initial concept stages through the documentation, registration and ultimate operation of their hospitality industry projects. We also have attorneys throughout the nation skilled in document preparation, regulatory issues, advertising and marketing—insight that is integral to successful structuring and development of a hospitality project.

Escrow, Title Insurance, and Closing Matters

We provide clients with comprehensive escrow, title insurance and closing services. BakerHostetler is fully authorized under Florida law to act as a title agent and both an ad valorem tax and purchase money deposit escrow agent if needed.

Strong Knowledge of Operational Issues
Hotel Management and Franchise Agreements

We have represented hotel owners as well as international hotel chains in the drafting, review and negotiation of hotel management agreements for a variety of hotel properties ranging from luxury resorts to urban business hotels to limited service lodging facilities. We have also reviewed and negotiated franchise agreements and license agreements with nearly all of the major hotel brands and understand issues that arise when a franchised hotel is sold or refinanced.

Resort Owner Associations, Management Matters, and Licensure

Our attorneys have created strategies to provide timeshare resort and condominium-hotel developers with flexibility and maximum control for management of the property as well as its owners association. Our representation also includes legal counsel related to a variety of licensure types, including real estate broker and salesperson, community association manager and mortgage broker, and lender licensing.

Employment and Labor

With a national practice devoted to employment and labor matters, we provide counsel on a full scope of the following issues: employment discrimination; employment contracts; non-compete agreements; wage and hour; Family Medical Leave Act; independent contractors; discrimination claims; and development of employee handbooks, policy manuals and benefit plans. Our attorneys understand how hospitality clients are affected by matters related to ADA compliance, Fair Housing, Equal Credit Opportunity Act and employee claims.

Bankruptcy and Commercial Law

We are experienced in workouts, problem loans, evictions, and bankruptcy, with a particular sensitivity to the unique issues that arise when a hotel or resort faces problems with creditors. Our attorneys also have handled and made numerous presentations on restructuring of loans to and on behalf of financial organizations and debtors.

Litigation

Our attorneys have handled major real estate-related litigation, including prosecuting and defending claims for specific performance, royalties, breach of contract matters, foreclosures, eminent domain, land use issues, title defects, and lender's liability. For our hospitality clients, we have handled such complex litigation issues as construction defects, delay damages, acceleration claims, management agreement defaults, franchise terminations, and changed conditions.

Consumer Credit

Members of our team frequently advise clients with regard to federal and state consumer credit and consumer protection compliance including such laws and regulations as Truth-in-Lending, RESPA, Federal Trade Commission laws and regulations, and telemarketing laws.

Governmental Affairs

We have a strong commitment to recognizing the legislative, lobbying, and administrative needs of our clients on a local, state, national, and international basis. We have experience working closely with the relevant regulatory agencies in the industry to help ensure our clients obtain the assistance and approvals necessary to meet their business objectives.

Select Experience

  • Represented a client in connection with a complex joint venture between a major multinational hotel chain and a publicly traded REIT adding a mixed use vacation ownership component to an existing resort hotel. The project involved the negotiation of various management, marketing and amenities agreements, and nine-digit construction and working capital loans.
  • Negotiated management agreements for a mixed-use hotel and casino project on land ground leased from a governmental authority. Our role included representation related to the hotel management agreement, review of the proposed ground lease, negotiation of a casino management agreement, branding of the project, consulting on regulatory and licensing issues, and cross border entity structuring.
  • Restructured a major branded timeshare business through the development of a new and cutting edge timeshare trust structure. Our team prepared documents addressing the various legal, regulatory, tax, and financing aspects of the new structure.
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Experience

  • Represented a client in connection with a complex joint venture between a major multinational hotel chain and a publicly traded REIT adding a mixed use vacation ownership component to an existing resort hotel. The project involved the negotiation of various management, marketing and amenities agreements, and nine-digit construction and working capital loans.
  • Negotiated management agreements for a mixed-use hotel and casino project on land ground leased from a governmental authority. Our role included representation related to the hotel management agreement, review of the proposed ground lease, negotiation of a casino management agreement, branding of the project, consulting on regulatory and licensing issues, and cross border entity structuring.
  • Restructured a major branded timeshare business through the development of a new and cutting edge timeshare trust structure. Our team prepared documents addressing the various legal, regulatory, tax, and financing aspects of the new structure.

Memberships

  • BakerHostetler is an active member on the state and national level in American Resort Development Association (ARDA) is the national trade organization of the resort and timeshare industry.
  • One of our attorneys serves as Treasurer and board member, and another sits on the ARDA International Foundation.
  • We serve as national tax and human resources counsel to the national association and as counsel to ARDA's Florida chapter.
  • A number of our attorneys serve as ARDA Trustees and as members of the Chairmen's League.
  • BakerHostetler is an active member of the Urban Land Institute (ULI) and one of our attorneys is a member of the ULI Recreational Development Council.

International Capabilities and Partnerships

Key Contacts

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In The Blogs

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HospitalityLawg®
The Federal Trade Commission Organizes a Multinational Taskforce to Combat Travel and Timeshare Resale Scams
June 6, 2013
The Bureau of Consumer Protection division of the Federal Trade Commission (“FTC”), the U.S. Federal agency responsible for preventing fraudulent, deceptive, and unfair trade practices, announced yesterday that it will undertake a...
Read More ->
HospitalityLawg®
The Federal Trade Commission Organizes a Multinational Taskforce to Combat Travel and Timeshare Resale Scams
June 6, 2013
Posted by Chirag B. KabrawalaThe Bureau of Consumer Protection division of the Federal Trade Commission ("FTC"), the U.S. Federal agency responsible for preventing fraudulent, deceptive, and unfair trade practices, announced yesterday that...
Read More ->