Quorum Hotel Advisors, a leading independent provider of customized hospitality management solutions, has announced the addition of receivership services to their extensive portfolio of offerings. Spurred by client demand, Quorum’s new service offering will provide for securing a given hotel asset on behalf of the court while simultaneously lending experienced oversight of day-to-day operations.
Although a hotel looks like any other real estate asset on paper, it is not. A hotel is a labor, capital and systems intensive operating business. In short, hotels are the most complicated form of commercial real estate. Quorum can secure the asset for the court while simultaneously providing experienced hotel oversight of the property.
With over 300 years of combined hospitality asset management knowledge and expertise, Quorum will ensure all of the right legal and operational steps are taken throughout the receivership process to preserve the value of the asset.
Our experience allows us to effectively perform all necessary actions as Receiver, such as:
- Securing all books, records, bank accounts, cash, check books, keys, codes, contracts, permits and licenses from debtor/owner or representative
- Opening new bank accounts and paying critical vendors, if necessary
- Entering into essential service provider agreements such as utilities, security and employment agreements; inspecting and evaluating all vendor, maintenance and rental contracts and leases - renegotiate where needed to achieve the most cost effective terms
- Perform property, management and financial assessments relating to the asset
- Re-establish any and all financial controls that may have deteriorated, including the replacement of any proprietary computer systems or software removed from property by former brand manager
- Evaluate and recommend new brand solutions, franchise opportunities and more effective reservation systems to maximize the property’s market share
- Determine the capabilities of on-site staff and managers and their ability to continue to be of value to the asset
What Is Receivership?
By definition, a receivership is a state court proceeding governed by state law. A receiver is an officer of the court holding possession of the property for the court that appointed the receiver. The main purpose of a hotel receivership is to transfer control of the asset from the owner/borrower and make management and other necessary changes while the lender determines what remedies will be exercised.
As an extension of the court, the receiver’s powers are governed by the powers granted by the court. The scope of that power is outlined in the court order appointing the receiver. As part of our receivership services, Quorum will review and assist with the “Order- Appointing Receiver.” By assisting in its preparation, Quorum can help identify numerous hotel industry specific situations with which legal counsel may not be familiar.
Why Quorum?
In many receivership situations, the process itself further impacts a hotel’s performance since most hotel receivers do not operate in the lodging business. Quorum understands the hurdles, challenges and opportunities when transitioning a property and developing a new strategic plan of action. Quorum has been involved in over 40 distressed hotel situations since 1987. Quorum understands the hurdles, challenges and opportunities when transitioning a property and developing a new strategic plan of action.