HERSHA HOSPITALITY MANAGEMENT added 25 hotels with approximately 4,000 rooms total over the last year. This expansion during the COVID-19 pandemic was made possible by working with its owners, pushing sales and careful cost management, the company said.
HHM, led by Naveen Kakarla as president and CEO, also retained all of its existing management contracts in 2020. It holds a portfolio of 140 hotels with more than 20 institutional and long-term owners, with one-third being lifestyle and independent hotels, one-third resort and full-service and one-third urban and select-service.
“Our senior leaders have worked together through many prior cycles and knew how to adapt very quickly to the many challenges and opportunities resulting from the pandemic,” Kakarla said. “We focused immediately on our existing owners and understood that being scrappy – and helping them manage liquidity, streamline operations and drive market share – was our singular priority. For example, our proprietary and cutting-edge revenue management techniques, when combined with an unrelenting focus on direct sales, resulted in HHM growing market share at a record pace throughout the past five quarters.”
The company’s growth has been geographically diverse and has expanded its client base, said David McCaslin, HHM chief development officer.
“These clients are increasingly recognizing our expertise and leadership in their submarkets, with all major brands, and certainly our independent hotel capabilities,” said McCaslin. “For example, our growth includes new hotels ranging from Silicon Valley to New England to Florida. We really have focused on finding experiential properties that will stand the test of time, such as Hotel Nia, an Autograph Collection Hotel in Menlo Park, California; Sea Crest Beach Resort in Cape Cod, Massachusetts; and Islander Beach Resort in the Florida Keys.”
Three of the properties HHM added this year were luxury or lifestyle hotels. They are The Whitney Hotel in Beacon Hill in Boston; the THesis Hotel in Coral Gables, Florida, near Miami; and the Plaza Hotel at Pioneer Park in El Paso, Texas. The new additions join HHM’s existing portfolio of more than 25 luxury or lifestyle hotels.
HHM also added seven sponsored investments in the past two quarters.
“While we think of ourselves primarily as a hotel manager, we have available capital and dedicated teams whose sole focus is on acquiring hotels and expanding our investment portfolio,” Kakarla said. “We have been moving quickly and decisively in this area and look forward to making additional investment announcements soon.”
HHM manages nearly all of the hotels owned by Hersha Hotels and Resorts REIT, led by brothers Jay and Neil Shah, as well as almost 20 other institutional and high net worth owners. In October, Hersha Hotels and Resorts reported that it has seen success with its “Rest Assured” cleaning program implemented in response to the COVID-19 pandemic, which HHM implements at HT’s properties.