Brilla Group Launches First Private Equity Fund

Sep 7 2010 | 12:42pm ET

The Brilla Group, which focuses exclusively on investing in high-end beachfront hotels and resorts, recently launched its first private equity fund.

The $200 million vehicle will typically make $10 million to $30 million equity investments in luxury beachfront properties in markets including the Caribbean, South Florida, Mexico, Central America and Colombia.

"We tend to look at future loan to value scenarios of 50% of the purchase price, and we tend to joint venture with partners do this type of acquisition," said David Brillembourg, chief executive officer of the Miami-based Brilla Group, which he founded in 2007. "We could buy properties with a $120 million price tag if all those things played out."

Brillembourg added that the firm also focuses on buying properties that are below replacement cost, and that are in markets that have not been penetrated in the luxury space, such as Colombia and the other aforementioned locales.

And while the loose lending and overbuilding that pre-dated the financial crisis continues to affect all aspects of the real estate sector, Brillembourg said the Brilla Group is well positioned to benefit from dislocation in the marketplace.

"You will continue to see significant trouble in the market as properties need to restructure their capital stack from four components—people overpaying for properties, people overleveraging properties, people over building properties and people running out of time," he told FINalternatives. "Those four things are going to continue to create significant opportunities for investors in the space."

Last year, the Brilla Group spent $100 million investing in eight hotels. This year,  Brillembourg said he expects the new private equity fund to deploy a similar amount of capital, but in fewer hotels with bigger price tags.

"We have been buying bigger properties, so we will close the year having bought four," he said.

And where does Brillembourg himself go on vacation when he has the time? Two of his favorite getaways are The Raleigh Hotel in Miami Beach and the Hotel Isle de France in St. Barts—both of which are Brilla Group properties.


In Depth

Q&A: Brevan Howard’s Charlotte Valeur Talks Strategy

Sep 18 2014 | 11:18am ET

Charlotte Valeur chairs the board of Brevan Howard Credit Catalysts, an LSE listed...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

Volkered: How Financial Sector Reforms are Creating Opportunities for Hedge Funds

Sep 16 2014 | 11:28am ET

New regulations have dramatically curtailed proprietary trading activity in investment...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

September 2014 Cover

The London Whale: Rogue risk management

Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.