March 22–OTO Development will celebrate its 10th anniversary in May.
And the Spartanburg-based hospitality company said it is poised for even greater success as it enters its next decade of hotel development and operations.
On Friday, the company announced that it sold a package of 15 hotels Thursday to Blackstone Group, one of the world’s largest equity firms, for an undisclosed price. Blackstone hired OTO to continue operating the hotels, the company said.
Corry Oakes, president and CEO of OTO, said the announcement is a “significant milestone” in the company’s history.
“Due to our strong property management performance, (Blackstone) hired us to continue operating the hotels,” Oakes said. “We now operate multiple hotels for both a publicly traded (real estate investment trust) and the largest private equity firm in the world as a third party manager. These are sophisticated organizations that can hire anyone, and they chose us.”
Oakes said his company’s property level and corporate support team members are performing at a very high level and others in the industry are “taking notice.”
The company was founded in May 2004 by a group of executives and founders for Extended Stay Hotels, including business moguls George Dean Johnson Jr. and Wayne Huizenga. Oakes was a part of the group along with Todd Turner, who currently serves as the company’s vice president of real estate.
OTO started with no hotels, no prospects of earning any revenue for at least 18 months and only a handful of employees. The business plan was to partner with the best brands in the hospitality industry and develop great hotels in growing markets, Oakes said.
“Since then, we’ve won about every national development and operating honors those brands award, we’ve opened 50 hotels and created over 1,250 jobs,” he said.
The company has its corporate headquarters and about 50 employees in the former Extended Stay Hotels building at 100 Dunbar St. in downtown.
Oakes said OTO recently moved toward a new development model that is “high-barrier” and “urban-centric.”
It has opened a Marriott Fairfield Inn and Suites hotel in Manhattan across from Madison Square Garden and a Hampton Inn in Washington D.C. about two blocks away from The White House. The Washington property has already won a national development award from Hilton.
OTO is constructing a 30-story Hampton Inn in Manhattan at the center of Times Square and will open three hotels in Seattle, Washington D.C. and Palo Alto, Calif., later this year.
In Santa Monica, Calif., the company is building two hotels–a Courtyard and Hampton Inn. They will be the first new select service hotels to open in that city in more than 30 years, according to OTO.
Oakes said the new projects in development are worth about $700 million and the company is pursuing another $300 million in future deals.
He attributed the company’s growth to its partners, which he said are “sophisticated” and “long-term.” He also thanked founders Huzienga and Johnson for their continued support and guidance.
The company increased its revenue fivefold between 2008 and 2011, one of the worst periods of economic recession in modern history.
“Our industry is very cyclical, and we’ve emerged from some very tough conditions as a much stronger organization,” Oakes said. “Our future is very bright.”
For more information, visit: www.otodevelopment.com.
