Driftwood Capital is planning to spend $3 billion over five years through development, acquisitions and a new lending platform.
MIAMI--Driftwood Capital (formerly Driftwood Acquisitions & Development), a privately held real estate firm specializing in hospitality investments, is restructuring and scaling up its activity in 2020 via its new Development, Acquisitions and Mezzanine Lending GP Funds. To encompass all new funds, the management team behind Driftwood Acquisitions & Development (DAD) has rebranded as Driftwood Capital. Driftwood Capital is targeting development and acquisition deals across the country in the $30 million to $150 million range, though as evidenced by the company’s planned $250 million, 502-key oceanfront Westin Resort in Cocoa Beach, Fla., they have the capacity to take on larger projects. Through its mezzanine lending division, the company is issuing loans in the $3 to $50 million range.
“The decision to scale up our existing acquisitions and development activities and launch a new lending business was driven by two main factors. First, we want to continue to meet the growing demand in the marketplace for alternative investments. Second, we want to ensure we have a long runway ahead of us for future capital deployments,” explained Chairman & CEO Carlos J. Rodriguez, Sr. “In addition, with the launch of our lending platform, we now have the ability to fulfill a growing niche for small to midsize loans in the hotel space.”
“Our real estate asset syndication model has proven very successful and popular with investors. With these new funds, we will invest in a broader range of hospitality opportunities with longer time horizons to syndicate LP capital, ensuring greater volume, diversity, and security for our investor network,” added President & COO Carlos Rodriguez, Jr. “We are actively engaged in expanding our network of investors. We are also expanding our strategic partnerships with others in the market wherever we find synergies. We will consider joint ventures with other experienced investment groups/developers across the country.”
Investors in the new GP Funds consist of DAD’s initial investors as well as longstanding LP investors, strategic capital partners, and other JV partners. A handful of these investors will be named to three Advisory Boards and Investment Committees, bringing a vast array of experience and immense strategic value to the company. Additionally, Driftwood Capital has strengthened its management team to help position it as a leader in the marketplace, and recently hired David Steiner as Managing Director of Capital Markets, Nelson Parker as Managing Director of Development, and Paul Sacco as Chief Investment Officer.
Since launching in 2015, Driftwood Acquisitions & Development placed more than $400 million in LP capital in both hotel acquisitions and developments across the United States, representing a portfolio of over $1 billion in assets that includes the Marriott Mission Valley San Diego, the Sheraton Park City, and the Margaritaville Lake of the Ozarks, as well as the soon-to-open developments Canopy by Hilton West Palm Beach & Tempe and the dual-branded Tru by Hilton/Home2 Suites by Hilton in Fort Lauderdale. All these hotels are managed by Driftwood Capital’s affiliate, Driftwood Hospitality Management, based in Palm Beach, FL. Driftwood Capital targets deal level returns in excess of 15% IRR and average dividends over 8% for LP investors.
About Driftwood Capital
Driftwood Capital (formerly known as Driftwood Acquisitions & Development) is a Coral Gables, Florida-based company with a first-of-its-kind business model allowing accredited investors to co-invest in institutional quality hotel assets at an attractive basis (minimum $50,000 investment). Driftwood Capital’s affiliate management company (DHM), a long-standing industry leader, is brought in to operate the hotels. Driftwood is also a reputable leader in the EB-5 Investor program, a government initiative to attract foreign investment to create jobs in the U.S. For more information, please visit www.driftwoodcapital.com.