L to R: ACORE Capital CEO Warren de Haan, Driftwood Capital President & COO Carlos Rodriguez Jr., Driftwood Capital Chairman & CEO Carlos Rodriguez Sr., Marriott International President & CEO Anthony Capuano, Knotel CEO Michael Gross
Driftwood Capital, a leading vertically integrated commercial real estate firm, hosted its ninth annual investor conference. The event, held on December 3 at the JW Marriott Marquis in Downtown Miami, brought together more than 500 attendees, alongside key industry figures such as Marriott International President and CEO Anthony Capuano, Wells Fargo Senior Economist Charles Dougherty, ACORE Capital CEO Warren de Haan, and Michael Gross, formerly CEO of Morgans Hotel Group and executive roles at WeWork.
The conference served as a platform to examine pivotal industry trends, present Driftwood’s strategic outlook, and foster connections across its growing global network of private and institutional investors.
“2024 was a year of navigating challenges and uncovering opportunities amid persistent macroeconomic headwinds,” said Carlos Rodriguez Sr., Chairman and CEO of Driftwood Capital. “From managing elevated interest rates to capitalizing on growth in corporate and luxury travel, Driftwood maintained a proactive approach. This is reflected in our $1 billion development pipeline, achieving total loan originations of $480.2 million, encompassing mezzanine loans by Driftwood Lending Partners alongside corresponding senior loans. Additionally, we invested over $100 million in renovations, reaffirming our commitment to enhancing and strategically positioning our portfolio.”
Strategic Insights and 2025 Projections
Framing 2024 as a “transition year,” Driftwood executives outlined plans to build on the industry’s momentum heading into 2025. President and COO Carlos Rodriguez Jr. emphasized the firm’s readiness to launch three new funds focused on value-add opportunities, credit, and luxury lifestyle assets, positioning Driftwood to meet growing demand across these segments.
“2025 promises to be transformative,” said Rodriguez Jr. “We see significant upside in the evolving preferences of business and high-end leisure travelers, coupled with disciplined investments in markets where fundamentals remain strong.”
Rodriguez Jr. also highlighted long-term trends, including an anticipated 3% increase in hotel valuations next year, driven by historically low supply growth of approximately 0.8% annually—nearly half the pace of past cycles. This underpins Driftwood’s $1 billion development pipeline being potentially delivered at an opportune time in the next up cycle.
“The hospitality industry, which trades at a higher cap rate between 7% to 9%, offers attractive prospects. Hotels generally have attractive risk premium spreads, 300 to 400 basis points today, and can adjust rates in response to higher interest rates, providing consistent returns,” asserted Warren De Haan. Hospitality has become a favored asset class with positive leverage (spread between cap rates and interest rates) unlike other commercial real estate sectors, e.g., multi-family and office, which has negative leverage, mainly for its ability to hedge against inflation by adjusting rates (daily leases) based on external factors.
Thought Leadership and Industry Dialogue
The conference featured thought-provoking sessions, including a fireside chat with Warren de Haan and Michael Gross, moderated by Rodriguez Jr. Discussions revolved around high-growth markets such as Florida and Texas, where positive migration patterns fuel economic expansion, and the integration of technology to meet shifting consumer demands. Gross highlighted shifting consumer trends that extend “beyond the four walls,” providing valuable insights into lifestyle hotels being a catalyst for experiential elements in other real estate asset classes like in office and residential.
Leadership in Focus: Fireside Chat with Marriott International’s Tony Capuano and Driftwood Capital’s Carlos Rodriguez Sr.
Marriott CEO Anthony Capuano closed the event with a keynote on the future of hospitality in the age of AI, emphasizing the enduring value of human connection in the industry. “While technology enhances efficiency, it cannot replace the personal touch that defines hospitality,” Capuano remarked. He also shared insights on leadership, drawing inspiration from Marriott founder Bill Marriott’s commitment to grassroots engagement and hands-on management.The conference highlighted Driftwood’s ability to convene the industry’s foremost leaders and investors, reinforcing its commitment to transparency, accountability, and building meaningful relationships in hospitality.
For more information, visit www.driftwoodcapital.com.
About Driftwood Capital
Driftwood Capital is one of the country’s leading hospitality sponsors. A vertically integrated commercial real estate firm with investment, development, lending and management platforms, Driftwood’s business model provides accredited investors access to institutional-quality hotel assets or capital solutions on a direct deal basis following deal closing. Since 2015, Driftwood Capital and its principals and affiliates have transacted on more than $5 billion in hospitality assets, including new ground-up hotel development projects, cash-flowing hotels and hotel-backed loans. Driftwood’s in-house team oversees deal sourcing, underwriting, financing, asset management, operations, development and legal issues. For more information, visit www.driftwoodcapital.com.| IG: @DriftwoodCapital | LI: @DriftwoodCptl
