The aloft Tempe is the first of four high-end, limited-service hotels pegged to launch California-based Triyar Hospitality’s $160 million joint venture with a Warburg Pincus Real Estate fund.
While Triyar Companies is based in California, the company owns a significant amount of downtown Scottsdale property and has been a prolific local developer.
Triyar’s planned five-story, 136-room Tempe hotel at 951 E. Playa del Norte Drive, north of Tempe Town Lake and east of Scottsdale Road, has been making its way through the city approval process. It is expected to start construction in about a month and be completed in December, 2008, said Triyar Hospitality CEO Michael Mahoney,
It will be one of the first versions of industry giant Starwood’s new chain of hip, urban, but not quite as pricey as a W, hotels.
Triyar is already building the Valley’s first W, slated to debut February in downtown Scottsdale, funded with the company’s own cash.
But the new venture with Warburg Pincus is expected to warp-speed Triyar Hospitality’s growth at a time when other hotel projects are foundering because of the national cash crunch, Mahoney said.
“We like these funky times,” he said. “We are in a position to take advantage of wobbly deals. People just can’t get hotels financed. We, fortunately, are in a position where we can.”
The company expects the $160 million to pay for the aloft Tempe and three more similar projects, and there is more money available through the partnership to fund one or two upscale, full-service hotels, Mahoney said.
Triyar is in negotiations for several right now, including new builds and conversions or completions of projects that have lost funding, he said. Those sites are in Texas, Nevada, California and at least one more in Arizona, Mahoney said. He wouldn’t say where the local project is or what brand is being considered.
Triyar is high on aloft and element, Starwood’s new extended-stay hotel chain, he said.
“But we’re not glued to Starwood brands,” he said.
Mahoney said he hopes to get as many hotels in the works as quickly as possible while the market characteristics are so favorable for the company.
“Time is the enemy of the developer. We don’t earn any money while we are developing,” he said.