US: Sandpiper Cos, a developer and operator of extended stay hotels, has formed Sandpiper Lodging Trust, a privately held lodging REIT.
To start the REIT, Sandpiper Lodging Trust acquired nine extended stay hotels from its subsidiary Sandpiper LLC.
Sandpiper has been managing extended stay hotels for 10 years. Its P. Carter Rise, an apartment developer, got involved in the extended stay sector when he saw a “large, untapped market composed of people who needed a place to stay for a week to six months or more”.
Sandpiper Cos. is a private equity firm that built its first extended-stay hotel in 2009, a WoodSpring Suites in Chesapeake, Virginia. In 2012, it formed Sandpiper Hospitality, a management company. Jim Darter is president and CEO of the enterprise, which manages 34 extended stay properties.
Sandpiper LLC’s portfolio consists of WoodSpring Suites and Extended Stay America hotels.
Sandpiper Lodging Trust (SLT) now owns nine of the WoodSpring Suites hotels. The REIT was capitalised through the roll-over by a majority of the investors in the hotels of their ownership interests in exchange for equity in SLT, the completion of a new $75 million credit facility, and the private placement of approximately $12 million of new Class A common shares in SLT.
“Our predecessor funds delivered outstanding returns to our investment partners, and it was time to recapitalise those funds into a vehicle that we could build on for the future,” said Rise. “We are extremely happy that our current investors, as well as our new investors, see the opportunity to build a meaningful portfolio of extended-stay hotels.”
