jULY/AUGUST 2018 BCBusiness 83 ISTOCK
S
ooner or later, anyone with designs
on the U.S. hotel market will get to
know a small Vancouver rm called
American Hotel Income Properties
REIT LP (AHIP). Last year AHIP was the
No. 3 buyer of stateside hotels after U.S.
invest ment g ia nts Sta r wood Capita l
Group and Blackstone Group, purchasing
$750 million worth of properties, says
president Ian McAuley.
"Now we get the phone calls from the big
investors that maybe want to sell a portfolio
and don't want to go through a marketing
process," McAuley adds of
AHIP, a new
addition to the Top 100 at No. 90. "We're a
well-known entity now where three years ago
nobody had even heard of us."
AHIP, which has 15 employees, was
co-founded by
CEO Rob O'Neill and launched
in 2013 by going public on the Toronto Stock
Exchange. The limited partnership owns one
asset, a U.S.-based hotel/lodging
REIT.
"It's an opportunit y for Canadian
investors to invest in hotel real estate in the
U.S.," McAuley says of
AHIP. "There was no
vehicle for a Canadian to do that until we
created this company."
AHIP focuses on premium branded
hotels—names like Hilton, InterContinental
a nd M a r r iot t—i n s e cond a r y m a rket s
such as Ci nci n nat i, Oh io; A l lentow n,
Pennsylvania; and Jacksonville, Florida.
"We own the building and operate the
business through a third-party manager,"
McAuley says.
Two decades ago, O'Neill and his brother,
John O'Neill, started the Canadian Hotel
Income Properties Real Estate Investment
Trust (
CHIP REIT). But launching a REIT in
Canada has been forbidden since federal
income trust laws changed in 2007, the same
year British Columbia Investment Manage-
ment Corp. bought
CHIP REIT for $1.2 billion.
As of May,
AHIP owned 115 hotels in
33 states and had an enterprise value of
$1.6 billion. Where Canada offers only six
markets with more than 1 million people, the
U.S. is home to hundreds, McAuley notes. Its
secondary markets contain 3.4 million guest
rooms, versus just 1.6 million in primary
centres like New York and Los Angeles.
AHIP looks for so-called select service
hotels—a simple, ef£icient business model
prIvATe developers CommAnd The
spoTlIghT In b.C., buT TWo of our Top reAl
esTATe plAYers Are A publIClY TrAded
oWner of u.s. hoTels—And A governmenT
AgenCY TACklIng The provInCe's
housIng CrIsIs
b y N I C K R O C K E L
Home
and Away
R E A L E S T A T E
ROaD WaRRIOR
Vancouver's AHIP has
become a force in the U.S.
by focusing on hotels for
business travellers
