CIO Bulletin

Black Briar Advisors — unlocking potential in distressed hospitality

Despite being faced with this challenge many times, the problem of hotel assets becoming distressed and in direct need of being turned around often boils down to the same. And it might surprise you that, generally, the problem is due to a lack of insight in independent hotels on how the travel industry really works. There is also a shortage of understanding in business in general.

Given these turbulent times in the hospitality industry due to COVID-19, the hospitality sector was one of the first to endure the hardship of closures and the first to feel the economic brunt of the crisis. The U.S. hotel industry continues to stage its recovery from the decimation caused by the COVID-19 pandemic.

While there is optimism that this recovery will continue in 2023 as business and group travel resume, there are strong economic headwinds that threaten assets across the country. The hardships are still being felt for many properties; prompt action is critical to prevent crippling debts, layoffs, and the closure of distressed properties.

Such properties can definitely enlist the help of Black Briar Advisors in transforming their distressed hospitality properties into profitable ventures. Black Briar Advisors is a uniquely positioned full service real estate investment company that specializes in the acquisition, financing, and management of distressed hotel & resort assets. Black Briar and its principals have been directly responsible for over $4.5 Billion in real estate transactions, which include the acquisition and disposition of over 100 Hotel & Resort Assets.

The following excerpts were taken from a conversation with Stephen Nalley, the Founder and CEO of Black Briar Consulting

Q. How did you come up with the idea for Black Briar Advisors? How has the company grown in the market since its founding?

Black Briar Advisors was formed in March of 2020, at the beginning of the pandemic. However, the team has been together since 2004. Formerly known as Inner Circle Management, we acquired and managed distressed real estate assets, as that has always been our core strength. However, the pandemic posed an entirely different problem than what we had seen in the past 20 years. Black Briar was formed to exclusively focus on the repositioning and turnaround of distressed hotel & resort assets.

Q. How does Black Briar Advisors leverage its resources to transform hospitality assets?

Black Briar has significant resources and relationships throughout the industry. These relationships include legal, franchising, accounting, investment banking, timeshare, and purchasing, just to name a few. The majority of the assets that we deal with require an extremely aggressive approach with tight timelines.

Over the years, we have identified other professionals in the industry who are experts in their field and who can handle not only the demand but also produce the outcomes that we need within the timeframe that we need them.

Q. In what ways do your partners gain strategically from Black Briar Advisors?

Black Briar is an outcomes-based company. We do not waste much time dwelling on problems. We find solutions in ways that others cannot. The majority of our clients have already tried most of the traditional solutions and have even hired other firms like ours with little or no success.

Our partners not only get our years of experience, but they also get our ability to execute a turnaround plan better than anyone. We also provide our clients with the brutal truth. We do not string our partners along with narratives that do not benefit them. If we cannot solve their problem, we are honest about it up front and throughout the entire relationship. There is a running joke out there about us, and that is that you should not ask Black Briar if you do not want to hear the truth. We focus more on winning than relationships. Our company does not have any salespeople or business development professionals. Our clients prefer outcomes more than getting a bottle of wine at Christmas.

Q. What are the services offered by Black Briar Advisors?

Black Briar Advisor provides Distressed Assets Management and Repositioning for Hotel & Resort Assets. See www.blackbriarus.com for all of our services and descriptions.

Q. What is Black Briar’s philosophy for successful hotel management? Can you share it with our readers?

Our success is simple. We are outcomes-based, and everyone in our organization is in lockstep with one another. We are in perpetual training mode. Everyone in our organization is a leader. Where most organizations only provide leadership training once a year to the upper echelon, we provide leadership training to everyone in our organization daily. When you possess a team of self-motivated leaders, there is nothing that you cannot accomplish.

Q. The COVID-19 pandemic has had a devastating effect on the hospitality and tourism industries. How did Black Briar help its clients with their troubles during and after the pandemic?

There is not much that you can do for a closed hotel other than assist with bank workouts. However, the place where we were able to bring tremendous value was in the repositioning space. At the same time that many of the hotels were becoming functionally obsolete, there was a national crisis with affordable housing. Black Briar began providing consulting services for hotel owners and investors who were interested in converting hotel assets to apartments.

Q. Would you like us to highlight something important happening in your company that we may have missed asking about?

Black Briar Advisors just opened a division in Puerto Rico, which is called Black Briar Puerto Rico. We are currently working on several projects there, including an oceanfront hotel that is in Chapter 11 Bankruptcy. Black Briar Puerto Rico is being led by Maritza Vicente, who is a native of Puerto Rico.

Transforming distressed hospitality properties into their best versions

Stephen Nalley is an American Real Estate Executive, Entrepreneur, Veteran, Author, and the Founder & CEO of Black Briar Advisors, which is a full service real estate investment company that specializes in the acquisition, repositioning, and turnaround of distressed real estate assets.

Prior to Stephen’s professional career, he served in the United States Army as a Light Infantry Squad Leader with the Army’s Elite 10^th Mountain Division and the 2145^th in the US Army Reserves.

Stephen earned a Bachelor of Science Degree in Healthcare Administration from the University of North Florida, a Master’s in Business Administration, and a Doctorate in Business Administration from the University of Atlanta, as well as a Law Degree from the University Of Washington School Of Law.