Investing Up and Down the Hotel Equity Stack

By Marcia Caller Jaffe

Most of us want easy check in and clean rooms for hotel accommodations, but it’s quite a complicated business behind the scenes with all those moving parts. Think of financing, construction, property management, debt, responsibility to the investors, architects and engineers, to name a few.

Peachtree Hotel Group’s Greg Friedman is a mastermind entrepreneur who keeps all the issues in check. High atop the One Alliance Center in Buckhead, he is running a finely-tuned, multifaceted 85-person enterprise focused on investing, operating, developing and financing premium branded hotel properties across the U.S.

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The sleek office looks like a movie set with millennials interacting in huge conference rooms and rows of analysts in front of screens running numbers. As intense as they come, Friedman is laser-focused on his 100 hotel investments, deal structure, acquisition, risk and lending, as well as the guest experience. Over the past 10 years, he has done more than $1.5 billion in deals.

A dynamic Friedman leads Peachtree Hotel Group with his expertise in finance and the hospitality industry.

Originally from Fayette, Ala., he moved to Dallas with an eye on medical school after receiving his biology degree from the University of Texas, Austin. Instead he went to work for GMAC Commercial Mortgage Corporation’s hospitality finance group. Spring-boarding from this, Friedman’s own empire now sweeps through the Carolinas, Arizona, Texas, Georgia and Alabama, with flagships like Homewood Suites, Hyatt Place, Hilton and Marriott Courtyard.

When asked where his own talent lies, he muses, “Early on, I learned to make thoughtful decisions, not to move too quickly, how to listen to sound advice and understand my impact on relationships. … These days I have to find good locations in submarkets, understand what is driving demand and what is sustainable.” By that he means acquiring hotels in college towns or cities like Houston with big medical centers. “My goal is to protect investments. A huge success factor is not overspending on the buy side. … Thus my specific expertise is putting deals together, finding capital partners, and being financially savvy.”

He is strong on Atlanta because of its great history with lodging. “There is new excitement here: the Mercedes[-Benz] Stadium, SunTrust Park, State Farm, and downtown and midtown are super hot.”

Given where we are in the current economic cycle, a defensively-thinking Friedman said, “We are protecting ourselves by investing more on the debt versus the equity side. We are focused on the brands with the best retail distribution channels like Marriott and Hilton.” This year alone he expects to acquire another 13 hotel properties and make 35 debt investments.

Friedman, who owns up to being a workaholic, likes to vacation with family surfside in places such as Baha Mar in the Bahamas and Dorado Beach in Puerto Rico, throwing in Italy for good measure. He has a suburban lifestyle on weekdays in East Cobb alternating to a Buckhead condo on weekends. “My children like to be able to walk to the mall, restaurants and movies.”

When asked what advice he would give to a younger version of himself, he said, “I wish I had read ‘Originals’ by Adam Grant, who researched how we can all think more originally and improve the chances of innovating successfully. In the book Grant examines youth and birth order in the entrepreneurial world. The oldest child thinks more conservatively. That’s why younger baseball players are more willing to steal bases. The younger ones just make decisions differently and are more ‘street smart.’”

I know Freidman is indeed both young and “street smart” because I met him serendipitously in the lobby of a hotel where his proud Jewish mother pulled me aside with the clue, “Ask my son how he owned his first hotel at 29.”

If anyone knows the spreadsheet, she does.