LOS ANGELES — Noble Investment Group founder and CEO Mit Shah is excited for what's to come. As both a buyer and a developer of hotels, Shah said he see's a "generational investment opportunity in hospitality" ahead for his company.
But with serious competition for assets at the moment and "significant growth of multiples of valuation," the best deals might still be a couple years out, he said.
Speaking to Hotel News Now during the 2021 Americas Lodging Investment Summit, Shah said the best deals his Atlanta-based firm made after previous industry downturns were two or three years out from the initial crash.
"It takes time to understand the impact of those crises," he said. "It also takes time for the calibration between the financing that was originated on investments pre-crisis and how does that move forward when [earnings before interest, taxes, depreciation and amortization] are increasing."
He said that thesis was proven out during the last lodging downturn, which was sparked by the Great Recession.
"Our best investments as a firm were started in late 2011, and they lasted until 2014," he said. "Now, Lehman [Brothers] collapsed in the fall of 2008, right? So that was three, four years later before those opportunities started to take place."
He said the best deals will likely come from the $236 billion of lodging investment loans that originated from 2017 to 2019.
"Remember those times. Peak EBITDAs, peak valuations. All of those loans start to come due starting next year," Shah said. "So I think, when you think about the opportunity set of what will exist, there's situational opportunities this year, but we believe that those opportunities will continue to increase as time goes forward, much like it's done in the past."
Noble focuses on primarily select-service and extended-stay hotels under Marriott International, Hilton and Hyatt Hotels Corp. brands and claims roughly $4 billion in investments over nearly three decades.
For more from HNN's interview with Shah, watch the video above.