A former Trump official, who also dabbles in hotels, has struck a deal. Provenance Hotels, founded by Gordon Sondland, who served two years as United States Ambassador to the European Union under former President Donald Trump, closed on a strategic venture with an entity combined of Gencom, a Miami-based owner and developer of hospitality and residential properties, and Corten, a private real estate investment fund manager headquartered in Wilmington, DE.
Under the venture, the partnership has acquired a 50% ownership stake in eight hotels across the U.S., expanding the company’s portfolio by over 1,400 keys.
Provenance Hotels was founded in 2000 by Sondland, who in 1985 raised $7.8 million to purchase the bankrupt Roosevelt Hotel in Seattle. In March 2018, President Trump selected Sondland to be the next United States ambassador to the European Union, a position which had been vacant since January 2016. He was fired by Trump on February 7, 2020, two days after the conclusion of Trump’s impeachment trial. He has since written a book published this year and titled: “The Envoy: Mastering the Art of Diplomacy with Trump and the World.”
Pyramid Global Hospitality, the Gencom affiliate, which oversees hotel management and operations in the U.S. and Europe, will manage the entirety of Provenance Hotels’ portfolio of 12 hotels.
The eight properties will be jointly owned by the Gencom-led partnership and Provenance. The properties include: The Dossier, Sentinel, Hotel Lucia and Hotel Deluxe in Portland, Ore.; Old No. 77 Hotel & Chandlery in New Orleans; Hotel Max and Hotel Murano in Seattle; and Hotel Preston in Nashville.
In addition to the eight hotels, Pyramid will manage four hotels owned by third parties that were earlier operated by Provenance — Hotel Theodore in Seattle, Heathman Hotel and Woodlark Hotel in Portland and The Bradley in Fort Wayne, Ind. In total, Pyramid’s portfolio of managed properties will grow by 1,952 rooms and suites.
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 12 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 pursuit of opportunistic real estate assets and its overall growth initiatives.” Alibhai added.
This marks the first venture between Gencom and Provenance. This is also the first time that Gencom has partnered with Corten in a multi-asset deal.
“Gencom took a calculated risk entering this transaction during the height of the pandemic,” said Gencom’s Chief Investment Officer Alessandro Colantonio. “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.”
Founded 35 years ago, Gencom’s portfolio presently comprises of around $7 billion in assets under management and includes 15 properties in operation or under development with more than 7,000 hotel rooms worldwide. The group also owns two affiliated operating platforms, Pyramid Global Hospitality and etc. venues.
Founded in 2018, Corten and its principals have invested in more than 70 hotels and over $4 billion of total capitalization.