DALLAS—As its name might indicate, Prism Hotels and Resorts is seeing hospitality opportunities through a slightly different lens currently, giving second-quarter an interesting start. The full-service hotel management, investment and advisory services company recently inked a contract to handle the United Brotherhood of Carpenters International Training Center, a one-million-sq.-ft. facility in Las Vegas, adding a new avenue of engagement for the firm, which traditionally manages upscale branded hotels, resorts and boutique properties.
The campus is a training hub for one of North America’s largest building-trades unions, and can accommodate up to 800 persons across its meeting facilities, which include more than 30 conference rooms, 300 accommodations, food and beverage options and catering, and in situ training models that feature underwater welding tanks, virtual welders and gas-turbine training facilities.
Steve Van, Prism president/CEO, said the diverse portfolio addition is “a perfect fit for our company goal of giving our owners what they want. It is a unique owner whose main goal is great service to its members: the men and women who own the Carpenter’s Union. So we treat our guests there like the owners they are.”
The deal came about after the Union leadership hired Richard Warnick of CHMWarnick to put out an RFP.
“We were invited to participate because of our experience bringing systems to operations. The chemistry worked well because Prism and the United Brotherhood of Carpenters have the same values,” said Van.
While taking on the diverse project, Prism won’t be straying too far from its knitting. It also will oversee two other Las Vegas properties owned by the United Brotherhood of Carpenters—Homewood Suites by Hilton (147 rooms), a renovated property five miles from the Las Vegas Convention Center; and Tru by Hilton (160 rooms), a new development set to open in December that will serve as an overflow hotel for the training center.
The training center is also slated for future growth. The campus will undergo planned expansions to the lobby this year, and add a wing of administrative offices and meeting facilities.
According to Van, the training center “is an opportunity unlike any other that we’ve secured in our company’s history. The complexity of the project and its size make it one of the most unique opportunities for a management company in the country. Our team’s expertise in managing large properties and focus on delivering a world-class experience made this a fit for where we are as a company today.”
Prism also secured a management contract for the former Concourse Hotel at Los Angeles International Airport, now the 580-room Hyatt Regency LAX, the new home this year of the industry’s Meet the Money conference. It’s a deal Van sees as bringing bonus points.
“The advantage to Prism of managing the largest Hyatt Regency franchise in the U.S. is credibility, because Hyatt is so highly selective in approving third-party managers. It’s a great brand’s imprimatur that we are players in the big leagues,” said the CEO.
Van acknowledged there are challenges in the deals but felt confident nonetheless.
“The high-wire-act challenge is to increase NOI to the owner while improving employee morale and guest satisfaction. We know how to do it; it takes great systems, great talent and great commitment,” he said, noting, “Because we are fortunate to have more opportunities, we have been able to be strategic by being very selective, selecting owners who share our values, and having projects that fit our strategy.”
While many of Prism’s properties are legacy-hotel products, Van said the company is looking at several of the major soft brands, including Unbound by Hyatt and Curio by Hilton, because they offer “an effective fit for some unique projects which do not fit the legacy brands.”
In addition to recent deals, Prism Hotels & Resorts and Real Capital Solutions are partnering on a $200-million investment fund to purchase hotels, such as in Texas’ Permian Basin. Van noted the fund targets areas, including outside of Texas, distressed by the current low price of oil. “Our investor believes in a strong recovery of oil prices over his investment horizon. More than any other oil play area in the U.S., the Permian has the most upside,” suggested Van, who stressed the Real Capital Solutions relationship is Prism’s only programmatic partnership. “We are not looking for others but are happy to continue to manage for owners where we can make a significant contribution to enhancing their investment.”
Prism itself has equity in 15% of its portfolio, dependent on a case-by-case analysis of what the owner needs, said the CEO. He noted owners’ top needs currently include improving NOI through increased sales; improving NOI through expense controls; and improving NOI by combining increased sales and expense controls.
Meeting those needs is how the company will continue to advance, said Van, who added, “Our vision is to grow by having the most satisfied owners who give us repeat business.”