South African investors make US extended stay play

George Sell George Sell Uploaded 19 November 2018


US: South African property investment and development company Stonewood Alchemy Real Estate has acquired 16 extended stay hotels in Texas and Oklahoma.

Privately-owned Stonewood was founded in Guernsey in 2011 to provide global investment opportunities primarily to high net worth families who wished to invest alongside Stonewood.

Eldon Beinart, a director at Stonewood said the investment deal was worth R1.2 billion (US$85 million), and included the rights to build five additional hotels.

"This transaction augments our current American portfolio, which includes investments in the post-acute healthcare, memory care and assisted living sectors," he said.

Beinart said Stonewood's co-investment US partner was Denver-based EastSide Investment Partners LLC, and that their strategy was to acquire hotels that were underperforming and then add value to them.

"Our strategy has been to invest in properties in various countries, add value to them and then sell them on, often to real estate investment trusts," said Beinart.

"The extended stay sub-sector of the hospitality industry is also a play on the short- to medium-term accommodation sector. We believe multi-family yields in the US are at all-time low at the moment. This investment will tap into some of the key positive demographic trends supporting multi-family investments, at a very attractive entry yield," Beinart added.


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