Primarily focused on higher-end hotel and residential projects, Opwest Partners is planning to diversify its portfolio by developing several extended-stay hotels over the coming years.
The Scottsdale, Arizona-based company is a boutique investment and development firm. Along with Opwest's hotel and residential properties, it has entered the multifamily build-to-rent space.
Tyler Kent, Opwest founder and managing partner, worked for Starwood Capital’s development team and later the Athens Group, gaining experience in the luxury hospitality and residential space.
While Opwest’s focus has been in the luxury space, the team has considered opportunities in the select-service and extended-stay hotel segments over the years, Kent said. The company considered acquisitions, repositioning opportunities and ground-up development.
“We felt that it made a lot of sense to diversify within the hotel segment,” he said.
Extended-stay hotels have a multifamily lean to them, Kent said. There’s a lower risk profile with longer stays and a different mix of demand than in typical hotels. The extended-stay properties are more efficient to operate and more cost-efficient to build. They also have stronger performance compared to other hotel types, he said.
The Opwest team got to know My Place Hotels, a brand of extended-stay hotels created by Ron Rivett, founder of the Super 8 brand, and his grandson Ryan, Kent said.
“You’re talking about a generational extended-stay, midscale brain trust,” Kent said.
Opwest has committed to rolling out a portfolio of about 20 My Place-branded hotels over the next three to four years, he said. The company is targeting Arizona and other growth markets in the western U.S.
New Projects
Opwest has an affinity for hotel soft brands, particularly Hilton’s Curio and Tapestry collections, Marriott International’s Autograph and Tribute collections and Hyatt Hotels Corp.’s Unbound Collection, Kent said. In the past 18 months, the company has developed two upper-upscale, soft-brand properties.
The 169-key Senna House Hotel, Curio Collection by Hilton, opened in Scottsdale's entertainment district, Kent said. The hotel was designed to have food and beverage at the heart of the property. It also opened the 145-room Leo Kent Hotel, Tribute Collection, an adaptive-reuse property in downtown Tucson, Arizona.
“We really think that’s what travelers want,” he said. “They want something that has a story to it, something that they feel connected to that’s designed well and has this unique sense of place.”
Opwest is focused on the upper-upscale segment, and it will continue to look at luxury opportunities, Kent said. The company is staying active in that space as luxury properties tend to take longer to develop. It currently has a luxury project in Scottsdale it expects to open in late 2026.
The Scottsdale and Phoenix markets are undersupplied, particularly in the upmarket categories, he said. Opwest is geographically agnostic, so it’s also looking at opportunities in Nashville, Tennessee; and Charleston, South Carolina.
“It really just depends on the opportunity and the specific project, but we've developed across the country, and we'll continue to evaluate opportunities and pursue compelling projects in different markets,” he said.
Development Challenges
From a financing standpoint, it’s a challenging time to place equity, Kent said. When Opwest can find the right projects in the right locations with the right sponsorship, it’s still able to get things done.
The cost of capital is higher than before, and conversely leverage is lower, he said.
“The sequencing from a construction facility into a mini-perm bridge facility or a preferred facility is something that you really have to be surgical about right now,” he said.
What’s allowing Opwest to capitalize its projects is having great partners with staying power, Kent said. The company has been getting creative to get its projects financed.
Challenges in developing hotels, he said, have including supply chain disruptions and the cost and availability of labor.
Opwest is fortunate to have talented construction and project management players, Kent said. The company has been able to bring in projects reasonably on time or within extensions in the schedule. It has also been able to keep projects on budget, though some have required going in with a little more contingency that would have been necessary five years ago.