The 44th and McDowell Hotel Group, LLC, an affiliate of the Caliber Distressed Real Estate Income Fund (CDIF, LLC) private equity fund managed by Caliber Companies, today announced its acquisition of the 4-story, 228-room Holiday Inn Hotel & Suites Phoenix Airport North in Phoenix Arizona. The hotel is the Company’s third hospitality acquisition in three years. Along with the Crowne Plaza Phoenix Airport Hotel purchased in 2012, Caliber now dominates the Phoenix Airport North Submarket with ownership of an estimated 30% of available hospitality rooms located within 1.5 miles of Phoenix Sky Harbor Airport. The Holiday Inn Hotel & Suites will remain operating under the same brand. Heavlin Management Company will manage the hotel’s day-to-day operations.
“The Holiday Inn & Suites purchase embodies Caliber’s strength in identifying properties with strategic advantages and inefficiencies we can exploit to the benefit of our clients and partners,” said Chris Loeffler, Co-Founder and CEO of Caliber Companies. “We’re focused on continued growth in the hospitality sector, and we look forward to expanding our portfolio with other opportunities that will increase stakeholder value and return on investment.”
IHG (Intercontinental Hotel Group) has agreed to extend the ten-year Holiday Inn & Suites franchise agreement following a brand mandated property improvement plan of $1.3M. Caliber will invest an additional $3.7M in capital improvements including building modernization, restaurant renovation, cost cutting measures, space enhancements for group events and wedding business, signage and more to maximize the value of the hotel.
Heavlin Management plans are to bring the same turnaround success to the Holiday Inn & Suites as it has accomplished, in a short period of time, at Caliber’s other hospitality properties. Hotel operating profit at the Crowne Plaza has increased 300% year over year while the Hampton Inn & Suites, a newer asset, is up 20% in revenue. “Working with Caliber on this property, we’ll implement efficiencies gained from shared resources with the Crowne Plaza property including dual sales force and revenue management to capture additional market share,” said Frank Heavlin, President of Heavlin Management Company. “We value our partnership with Caliber and we’ll be strategically creative using techniques like the IHG hotel brand to drive business and central purchasing to increase profitability of assets for a win-win.”
A 2014 Inc. 500 award recipient for fastest U.S. growing private companies, Caliber assists clients in maximizing their growth potential and income through diverse, asset-based investment strategies.
CDIF acquires and improves commercial real estate properties, builds community betterment, creates new jobs and widens property ownership opportunities for investors. Key properties acquired and/or renovated through the Fund include the Hampton Inn & Suites Scottsdale-Riverwalk (purchased in 2014); Crowne Plaza Phoenix Airport; Bahia 101 Class-A office building development; 167-unit Sunrise Apartments in Tucson; 70-unit Mountain View Square Apartments in Phoenix, 24-7 Automated Self Storage in Las Vegas and Baywood Square Professional Park in Mesa.