May 5, 2015
There’s a new hospitality company in Delaware that is hoping to become a big player in the Mid-Atlantic region hotel industry. TKo Hospitality launched six months ago and is based in Newport, Delaware. The company will soon start development of five new hotels in Pennsylvania and Maryland.
Harvey Hanna & Associate’s co-founder, E. Thomas Harvey, has launched the hospitality company, TKo Hospitality, along with 2 former top-level executive employees of a Connecticut-based hospitality company, Meyer Jabara Hotels.
Kostas Kalogeropoulos and Vince DiFonzo, are more familiar with the hotel management side of the hotel industry and TKo Hospitality’s first venture was to take over the management of Lighthouse Cove from their former employer.
Harvey also heads Dewey Beach Enterprises (DBE), the development company of Lighthouse Cove which encompasses the Hyatt Place Hotel; penthouse and bayside residential condominiums; retail stores and restaurants; a future conference center; and an array of public amenities.
“The hotel industry is finally starting to pick back up and we think we’ve assembled a team that’s uniquely poised to take advantage of that growth,” Harvey said. “Our goal is to have 1,000 rooms in our portfolio by the end of 2016 with 50 to 100 percent more by the start of 2018.”
TKo Hospitality plans to take advantage of the hotel boom by offering a consolidation of services, such as guiding developers and hotel owners through the design stage, construction and eventual management of their hotels. The company has been stoking the fires in order to eventually work on projects closer to home.
“Right now, there are a couple of things we’re looking at in New Castle County and one in Cecil County,” said E. Thomas Harvey, the company’s chairman and co-founder. “We’ve got a lot of prospects we’re working on, but prospects are not deals.”
Currently the hospitality company is working on three hotels that will be adding 400 rooms in an undisclosed “resort community on Maryland’s Eastern Shore” and two hotels that will be adding 250 rooms to the Lehigh Valley region of Pennsylvania. They are also hoping to acquire third-party management contracts with other existing hotels in the area.
According to Amanda Hite, president and COO of STR inc., the hotel industry leading data provider, “ADR (Average Daily Rate) and RevPAR (Revenue per available room) for the year were the highest ever recorded by STR, and we expect more growth in 2015,” she added, noting that the company is forecasting a 5.2-percent increase in ADR and a 6.4-percent increase in RevPAR for the year.
The hotel industry has picked up in the past few years and there is a shortage of hotel rooms due to the stagnation of the recession. STR inc. data indicates that the number of hotels rooms nationwide grew at a rate of less than 1 percent last year, while demand rose 4.6 percent. The 2016 national occupancy rates are expected to reach a 30 year high.
If things continue in this fashion, TKo Hospitality may be entering the industry at the right time and the results could be quite beneficial for the new company.
“This is a consolidation industry and I like being a consolidator,” Harvey said. “Our goal is to see what we can amass and where that will take us. I think this is going to be a fun ride.”