Understanding the hospitality sector with Desi Co of Accord Group
In January, Accord Group Holdings, a global real estate strategic investment and capital advisory firm, announced it had made a capital commitment to Noble Hospitality Fund VZ (NHF V) and that it had acted as a capital adviser for the fund, helping it hit its hard cap of $1 billion earlier in the month.
Managed by Noble Investment Group, NHF V is investing in value-add opportunities in select-service and extended-stay hotels across the United States.
In an interview with IREI, Desi Co, managing partner at Accord, explained in greater detail what he and Accord find enticing about the hospitality sector in today’s market environment.
“One, it tends to run at very high operating margins, typically much higher than full-service hotels,” Co said. Those lower margins are due to a number of reasons, including lower labor needs which enable it to offer nightly rates just below higher-end hotels.”
Secularly, another factor contributing to the favorable out