Lend Lease Reaches Financial Close on U.S. Army Lodging Privatization Program
NEW YORK—Lend Lease (US) Public Partnerships (Lend Lease) has reached financial close on the second phase of the Department of the Army’s Privatization of Army Lodging (PAL) program and secured $275 million in project debt. Focused on improving the condition of on-post hotel facilities for Military members, their families, and all government travelers, the project includes the renovation and development of approximately 8,200 hotel rooms on 21 Army installations throughout the United States and Puerto Rico. InterContinental Hotels Group (IHG) is the PAL hotel operator. READER COMMENTS
“Lend Lease and IHG understand and appreciate the Army’s ongoing mission to elevate the quality of the lodging experience for its official travelers. The knowledge and expertise of these two industry leaders is key to the success of this initiative,” said Rhonda Hayes, Chief, Capital Ventures Directorate of the Office of the Deputy Assistant Secretary of the Army, Installations, Housing, & Partnerships, in an announcement. “We have structured the PAL program to not only address our current needs, but to ensure the long-term sustainment of the program for more than 50 years. After fees are paid to our partners for their involvement, all profits are reinvested back into the project. It’s a win-win solution, setting a new precedent for military hotels.”
The PAL program began in 2009, with Lend Lease assuming ownership of hotel facilities on 10 Army posts. In 2010, the company was asked to implement the second phase of the program at an additional 11 posts. Lend Lease was offered the third and final phase of the PAL program in October 2011. Subject to the Army and Lend Lease agreeing to terms and closing this final phase, Lend Lease will oversee more than 15,000 hotel rooms on 42 military installations.
Existing facilities are receiving extensive renovations and upgrades that include bringing select hotels up to the standards required to operate under the Holiday Inn Express brand. In addition, five new Candlewood Suites hotels will be developed over the next two years, the first of which is being built on Joint Base San Antonio, Texas. Groundbreaking for the 310-room hotel took place in May with completion expected spring 2014.
Operating under the name IHG Army Hotels amenities include complimentary breakfast, concierge services, weekly social activities, courtesy shuttles, and the opportunity to earn Priority Club Rewards points for their hotel stays.