Resilient Asset Class: Sandpiper Lodging Trust Grows Extended-Stay Footprint

Sandpiper Lodging Trust

Since its development in2018, Sandpiper Lodging Trust (SLT), a Richmond, Virginia-based realty financial investment trust, has actually been pursuing developing a nationwide footprint of extended-stay hotels and constructing significant scale in the section. As SLT’s President and CEO Carter Rise informs LODGING, “We mean to develop a ‘best-in-class’ platform of extended-stay possessions that will regularly offer strong capital and eventually extremely strong capital gratitude.”

Starting with its preliminary acquisition of 9 WoodSpring Suites residential or commercial properties in 2018, SLT has selectively pursued acquisitions and ground-up advancement to more broaden and diversify its portfolio. Today, the REIT owns 28 extended-stay hotels throughout 9 states. In the in 2015 alone, it included 5 homes, consisting of brand-new brand names and its very first hotel in Florida, which Rise calls a “tactically crucial market.” In January, SLT finished the acquisition of another 5 hotels— WoodSpring Suites situated in White Marsh, Md., Greenbelt, Md., Virginia Beach, Va., and 2 in Baton Rouge, La.– from its affiliates Sandpiper Hospitality III, LLC and Sandpiper Hospitality IV, LLC. The latter deal was funded mostly through loaning under its just recently broadened $200 million revolving credit center and the rollover of most of financier equity in the associated funds.

These acquisitions weren’t SLT’s only gains in 2022; the REIT simply ended what Rise refers to as a record year. “While our efficiency was favorably affected as an outcome of our acquisitions, tenancy stayed extremely strong at our residential or commercial properties and our development in space rate (ADR) was the most significant factor to our earnings development as it enhanced meaningfully versus the previous year,” Rise discusses. Despite the fact that labor obstacles and increasing rates of interest balance out some earnings gains, SLT’s changed funds from operations (AFFO) reached an all-time high, he keeps in mind.

Looking at the year ahead, Rise stays positive. “While we have actually seen a slower start to 2023 concerning our tenancy, we understand the extended-stay sector is an extremely durable possession class. These extended-stay hotels have actually outshined their nighttime stay peers over the last 3 recessionary durations, and ought to the economy continue to soften in 2023, our company believe SLT is extremely well placed.”

Headwinds or not, Rise sees development on the horizon. Equipped with a strong balance sheet, SLT plans to profit from chances when they provide themselves, more than likely in the latter half of2023 “We continue to focus the majority of our focus in those locations where there are strong development characteristics, i.e., states situated in the Mid-Atlantic, the Southeast, and the Southwest,” he discusses. “We stay extremely positive about the long-lasting potential customers for SLT, particularly within the economy and midscale sectors.”


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