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Starwood Capital Group

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Starwood Capital Group
IndustryPrivate equity
Founded1991; 33 years ago (1991) in Greenwich, Connecticut, United States
FounderBarry Sternlicht
Robert Faith[1]
HeadquartersMiami Beach, Florida
Key people
AUMApprox. $115 billion (2024) [2]
DivisionsStarwood Retail Partners[3]
Websitestarwoodcapital.com

Starwood Capital Group is an investment firm headquartered in Miami Beach, Florida.[4] It is managed by Barry Sternlicht.[5] It was co-founded by Sternlicht and Robert Faith in 1991.[1] In 1993, Faith left Starwood to found Greystar Real Estate Partners.[1]

History

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In 1991, at the age of 31, Sternlicht launched the firm to buy apartment buildings that were being sold by the Resolution Trust Corporation, created by the federal government to hold and liquidate the real estate assets owned by failed banks after the savings and loan crisis.[5] Sternlicht raised $20 million from the families of William Bernard Ziff Jr. and Carter Burden of New York to fund these purchases.[6]

In 1993, the company contributed the apartment portfolio to Sam Zell's Equity Residential in exchange for a 20% stake in the company.[7]

In 1994, in partnership with Goldman Sachs, the company purchased Westin Hotels & Resorts in a $561 million transaction.[6] In January 1995, Starwood purchased Hotel Investors Trust, an almost-bankrupt real estate investment trust,[8] and in 2005, acquired Groupe du Louvre, which owned crystal maker Baccarat.[5] Groupe de Louvre was sold in 2015, but Baccarat was retained by Starwood.[9]

In 2009, a consortium led by Starwood Capital bought 40% of the loan portfolio of Corus Bankshares, which suffered from bank failure.[10] In 2010, the company lost an auction to buy Extended Stay Hotels, which was in bankruptcy. Starwood unsuccessfully filed an objection against the sale to Centerbridge Partners with the bankruptcy court in Manhattan.[11] In the same year, Starwood received a majority ownership stake in Riviera Holdings, owners of the Riviera hotel and casino in Las Vegas, Nevada and Riviera Black Hawk in Black Hawk, Colorado, after a bankruptcy reorganization.[12]

In 2012, the company began construction of a chain of hotels under the name of Baccarat Hotels and Resorts, featuring crystal chandeliers from Baccarat.[13] In 2015, the firm sold its flagship Baccarat hotel in New York City.[14] In the same year, the group partnered with Toll Brothers to develop the Pierhouse at Brooklyn Bridge Park.[15]

In December 2013, Starwood Global Opportunity Fund IX, in partnership with Vencom, bought 7 retail properties from the Swedish retail group Kooperativa Förbundet for 3.9 billion Swedish kronor ($593.3 million), and sold these in 2016 and 2017.[16][17] That year, the company acquired seven malls from Westfield Group, including Great Northern Mall in North Olmsted and Franklin Park Mall in Toledo, with properties in Indiana, California and Washington, together dubbed Starwood West.[3]

Between 2013 and 2014, Starwood also acquired three British hospitality groups: De Vere Group for £232 million,[18] Four-Pillars Hotels for £90 million,[19] and Principal Hayley Group for £360 million.[20]

In February 2014, Starwood Property Trust spun off Starwood Waypoint Residential Trust, a single-family rental real estate investment trust.[21] In January 2016, Starwood Waypoint Residential Trust merged with Colony American Homes, creating Colony Starwood Homes.[22] In 2017, it was merged into Invitation Homes.

In March 2014, the firm acquired a stake in the A.S. Roma football club,[23] and in October 2014, Starwood purchased 7 upscale malls in Virginia, Florida, North Carolina, Texas, and Michigan from Taubman Centers in a $1.4 billion transaction.[24]

In 2016, the company acquired 23,262 apartments from Equity Residential for $5.365 billion.[25]

In September 2017, Starwood invested $250 million in YOTEL for a 30% stake.[26]

In 2021, Starwood's mall holdings had decreased from thirty to eight with the impact of the COVID-19 pandemic on the retail industry, and the company selling some properties at a loss to reduce its $2 billion in CMBS mortgage debt.[27] The firm invested in Metropolis Technologies that year.[28]

In 2022, CEO Sternlicht voiced strong criticism of the Federal Reserve for creating calamitous economic conditions by needlessly raising interest rates.[29][30]

In 2024, the firm limited the amount of money that its investors could withdraw in order to preserve its available supply of cash.[31] This decision was made at a time when the firm was being negatively impacted by rising interest rates and the impact of the COVID-19 pandemic on the real estate industry.[32]

Real estate investments

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References

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  1. ^ a b c Rosta, Paul (October 18, 2012). "Bob Faith's Mission to Buy, Build, Manage Drives Greystar". Commercial Property Executive.
  2. ^ "Business". Starwood Capital. Archived from the original on January 16, 2024. Retrieved March 14, 2024. Assets under management are approximately $115 billion.
  3. ^ a b c d e Pritchard, Edd. "Investors eyeing Belden Village Mall, other Starwood properties". Canton Repository.
  4. ^ "Contact". Starwood Capital Group.
  5. ^ a b c "Starwood Capital Group: Business".
  6. ^ a b MCDOWELL, EDWIN (November 26, 1994). "Westin Hotel Co. to Be Sold To Starwood and Goldman". The New York Times.
  7. ^ Goldfarb, Jeffrey (October 26, 2015). "Keep one eye on Sam Zell's "For Sale" sign". Reuters. Archived from the original on October 28, 2015.
  8. ^ WARNER, MELANIE (December 8, 1997). "HOW BARRY STERNLICHT BECAME THE KING OF HOTELS". Fortune.
  9. ^ "Starwood Capital Group completes the sale of Groupe du Louvre and Louvre Hotels Group to Shanghai Jin Jiang International Hotels Development Co., Ltd" (Press release). PR Newswire. March 1, 2015.
  10. ^ Magin, Janis L. (October 6, 2009). "Starwood Capital takes over failed Corus". American City Business Journals.
  11. ^ Humer, Caroline (June 15, 2010). "Starwood fights Extended Stay sale to Centerbridge". Reuters.
  12. ^ Green, Steve (July 13, 2010). "Starwood Capital involved in takeover of bankrupt Riviera". Las Vegas Sun.
  13. ^ Karmin, Craig; Hudson, Kris (April 24, 2012). "Starwood's Crystal Vision". The Wall Street Journal.
  14. ^ "Starwood Capital Group Sells Baccarat Hotel New York To Sunshine Insurance Group Affiliate" (Press release). PRNewswire. February 9, 2015.
  15. ^ Barbanel, Josh (September 21, 2016). "Pierhouse Condos Take a Bow in Brooklyn Bridge Park". The Wall Street Journal.
  16. ^ "Starwood Capital Group And Vencom Agree To Sell Retail Assets In Sweden" (Press release). PR Newswire. July 19, 2016.
  17. ^ "Starwood Capital Group and Vencom Agree to Sell Retail Asset in Sweden" (Press release). PR Newswire. February 27, 2017.
  18. ^ "Starwood Capital Group Acquires De Vere Venues" (Press release). PR Newswire. March 11, 2014.
  19. ^ "Starwood Capital Group Acquires Four Pillars Hotels" (Press release). PR Newswire. January 16, 2014.
  20. ^ "Starwood Capital Group Closes Transaction to Acquire Principal Hayley Group" (Press release). PR Newswire. February 27, 2013.
  21. ^ "Starwood Property Trust Announces Completion of Spin-Off of Starwood Waypoint Residential Trust" (Press release). Business Wire. February 3, 2014.
  22. ^ "Colony Starwood Homes Announces Closing of $7.7 Billion Merger of Starwood Waypoint Residential Trust with Colony American Homes, Creating the Premier Single-Family REIT" (Press release). Business Wire. January 5, 2016.
  23. ^ "Starwood Capital Group Enters Strategic Partnership To Help Develop AS Roma's New Stadium Campus" (Press release). PR Newswire. March 26, 2014.
  24. ^ "Taubman Completes Sale of Seven Malls to Starwood Capital Group" (Press release). PR Newswire. October 17, 2014.
  25. ^ "Equity Residential Announces Closing of Sale of 23,262 Apartment Units to Starwood Capital Group for $5.365 Billion" (Press release). Business Wire. January 27, 2016.
  26. ^ "Yotel Is Getting $250 Million From Starwood Capital to Fuel Expansion". Skift. September 26, 2017.
  27. ^ a b "Sternlicht's Starwood Gives Up on Malls After Plunge in Values". Bloomberg. July 13, 2021 – via www.bloomberg.com.
  28. ^ "AI Platform Metropolis Closes $41M in Funding to Expand Parking Tech". Commercial Observer. February 17, 2021. Retrieved December 13, 2024.
  29. ^ "Billionaire investor Barry Sternlicht says Jerome Powell and 'his merry band of lunatics' are destroying faith in capitalism and leading us toward 'social unrest'" by WILL DANIEL; Fortune; October 22, 2022. Accessed 2022-10-25
  30. ^ "The Fed is going to cause 'unbelievable calamities' if they keep hiking, according to Barry Sternlicht" by Carmen Reinicke; CNBC; October 4 2022. Accessed 2022-10-25
  31. ^ Grant, Peter (May 20, 2024). "A $10 Billion Real-Estate Fund Is Bleeding Cash and Running Out of Options". WSJ. Retrieved December 13, 2024.
  32. ^ McCrum, Dan; Platt, Eric; Gara, Antoine (May 23, 2024). "Starwood Capital limits redemptions in struggling $10bn property fund". Financial Times. Retrieved December 13, 2024.
  33. ^ a b c d e f g "Starwood asking $1.2B for package of regional malls". Retail Dive.
  34. ^ a b "Starwood Capital acquires Belmar from Southern Ute tribe". September 25, 2015.
  35. ^ a b "Mall at Partridge Creek, Fairlane Town Center values plunge | Crain's Detroit Business".
  36. ^ Olberding, Matt (May 23, 2022). "Lincoln's Gateway Mall sold for $51.5 million". JournalStar.com.
  37. ^ a b c Staff, T. R. D. (July 19, 2022). "Starwood Holds Onto Suburban Mall After Losing Three Others". The Real Deal.
  38. ^ Benoit, Zach (November 29, 2014). "Rimrock Mall: 'A development of superlatives'". Billings Gazette. Retrieved October 27, 2022.
  39. ^ ""Solano Life 2018: Fairfield's mall, Vacaville's outlets provide plenty of shopping"; Daily Republic; August 26, 2018. Accessed October 27, 2022".
  40. ^ "Sources: Fairlane Town Center in Dearborn to be sold to Dallas developer | Crain's Detroit Business".
  41. ^ Hudson, Kris (April 17, 2012). "Starwood Capital to Buy Malls". Wall Street Journal. Retrieved October 27, 2022 – via www.wsj.com.
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