Gencom and Corten Real Estate Affiliates Close on Strategic Venture with Provenance Hotels
MIAMI, FL, WILMINGTON, DE, and PORTLAND, OR – December 15, 2022 Affiliates of Gencom, an international owner and developer of hospitality and residential properties, and Corten, a Mid-Atlantic based private real estate investment fund manager, today announced the closing of a strategic venture with Provenance Hotels, an independent owner of boutique hotels. Under the venture, a Gencom-led partnership has acquired a 50 percent ownership stake in eight hotels across the United States, expanding the Miami-based firm’s portfolio by more than 1,400 rooms and suites. In a related transaction, Gencom affiliate Pyramid Global Hospitality, which oversees hotel property management and operations throughout the U.S. and Europe, has acquired the Provenance Hotels operating company and will add 12 full-service hotels to its national network of managed properties.
The venture between Gencom and Provenance represents the first transaction between these firms, each with celebrated histories in their respective segments of the market. It’s also the first time Gencom has partnered with Corten on a multi-asset deal.
- Founded more than 35 years ago, Gencom has grown to become one of the nation’s leading firms specializing in the development and management of luxury resort and residential properties, alongside full-service hospitality operating platforms. Today, the Gencom portfolio is comprised of nearly $7 billion in assets under management and includes 15 assets in operation or under development with over 7,000 hotel rooms around the world. Gencom’s portfolio also includes two distinct affiliated operating platforms: Pyramid Global Hospitality, and etc. venues.
- Founded in 2018, Corten’s partners have decades of principal real estate investment and management experience with a demonstrated track record in acquisitions, design/development/construction, and property/asset/fund management. Known for its creative capital solutions, the firm and its principals have invested in over 70 hotels, in excess of 15,000 keys, and over $4 billion of total capitalization.
- Launched in 1985, Provenance Hotels is a premiere owner and operator of independently branded boutique hotels in destination cities across the U.S.
“Gencom’s venture with Provenance is a textbook example of our approach in identifying an opportunity and executing a creative investment strategy that complements our existing holdings,” explains Gencom’s Chief Investment Officer Alessandro Colantonio. “Gencom took a calculated risk entering this transaction during the height of the pandemic. While many were skeptical about the future of hospitality, we saw value in the Provenance portfolio’s real estate assets and believed these destinations would bounce back stronger. Today, Nashville, Seattle and New Orleans are among the top-performing hotel markets in the U.S.”
Brandon Flury, a principal leading Corten’s hospitality investments, added, “Our firm’s vertical expertise in this space allowed for an immediate philosophical alignment with Gencom and also facilitated an efficient execution of this highly nuanced opportunity. We are generally drawn to complex situations that require highly tailored capital solutions for joint venture partners like Gencom and Provenance, while at the same time meeting the return objectives of our institutional investors.”
Founder and Chairman of Provenance Gordon Sondland said, “We are excited about the opportunities this venture provides to our team members and guests, and we will be evaluating capital improvements to properties of the Fund. The Provenance management team will remain actively involved in the business, and we look forward to working with Gencom and Corten as we explore new areas for growth, both domestically and internationally. In particular, I plan to leverage the knowledge of the European market I gleaned during my time as U.S. Ambassador to the European Union.”
For Pyramid, the acquisition of Provenance Hotels’ operating company represents a strategic entry into new markets, according to Gencom Founder and Principal Karim Alibhai. “Pyramid Global Hospitality’s continued expansion in the hotel operations space is core to the strength of Gencom’s platform strategies. By acquiring Provenance Hotels and assuming third-party management of twelve additional properties with nearly 2,000 rooms, Pyramid now has a presence in several new markets that will present opportunities for future growth and support Gencom’s continued pursuit of opportunistic real estate assets and its overall growth initiatives.”
Eight hotels will be jointly owned by a Gencom-led partnership and Provenance: the Dossier, Sentinel, Hotel Lucia and Hotel Deluxe in Portland, Oregon; Old No. 77 Hotel & Chandlery in New Orleans; Hotel Max and Hotel Murano in Seattle; and Hotel Preston in Nashville. These properties are home to a combined 1,407 rooms and suites. In addition to the eight hotels, Pyramid will manage four hotels owned by third parties which were previously operated by Provenance: Hotel Theodore in Seattle, Heathman Hotel and Woodlark Hotel in Portland, and The Bradley in Fort Wayne, Indiana. In total, Pyramid’s portfolio of managed properties will grow by 1,952 rooms and suites.
Gencom is a U.S.-based investment firm that owns, operates and develops prized real estate around the world, with an emphasis on luxury hotels, resorts and branded residential properties; and which is also an active owner and investor in hospitality operating platforms. Gencom’s current real estate portfolio is comprised of some of the world’s most iconic hotels, resorts, and destinations which are amongst the leading properties in the industry with key operating partners such as Four Seasons, Ritz-Carlton, Rosewood, Auberge, Fairmont, Hyatt, Marriott and St. Regis. www.gencomgrp.com
Corten Real Estate is a private investment manager that targets middle-market common and preferred equity (direct and joint venture), subordinated debt and whole loan investments in hospitality, multifamily, and office properties located throughout the U.S. Corten’s sector expertise and ability to invest up and down the capital stack allow it to provide tailored funding solutions to operating partners/sponsors. Corten is headquartered in Wilmington, DE, with satellite offices in the Philadelphia, PA and Chevy Chase, MD. www.cortenrealestate.com
About Provenance Hotels
Headquartered in Portland, Oregon, Provenance Hotels owns, develops and manages market-leading independent hotels. Imbued with intentional, deeply integrated art stories, these Conde Nast Reader’s Choice Award-winning hotels showcase trend-setting amenities, creative collaborations with local co-conspirators and innovative food & beverage operations while focusing on operational efficiency and profitability. The portfolio includes 12 properties totaling nearly 2,000 keys. www.provenancehotels.com.