Graduate Hotels
CLASS® offers university partners an operationally strategic, and financially sustainable, approach to delivering a best-in-class hotel amenity as a part of their campus experience.
Primary roles & responsibilities
University
AJ Capital
Ground lessor
University leases hotel land to AJ as a part of the partnership; University retains ownership of that land and receives annual or upfront ground rent from AJ.
Ground lessee/hotel owner
AJ owns the leasehold interest of the land, allowing the right to operation and revenue. Pays annual or upfront ground rent to university partner.
Hotel brand
The Graduate Hotels® brand serves as the value proposition for the hotel's guest experience.
Hotel operator
The Graduate Hotels® brand handles on-property execution of the hotel's hospitality brand standards and services.
Typical Program
PHASES OF DEVELOPMENT
Bringing CLASS® partnerships to life.
Ground lease & financing
The hotel project site is conveyed via a ground lease to AJ for an average of 70-99 years. AJ fully finances the transaction.
Vision, design, & planning
AJ designs the hotel to fit hyper-localized hospitality mode. AJ takes all steps to obtain permits and execute the hotel.
Construction & preparation
AJ oversees the end-to-end construction plan for the hotel. As full owner of the project, AJ assumes all risk for construction completion and budget.
Graduate Hotels® launch
AJ launches the new Graduate Hotel property—remaining responsible for operations and financials. AJ owns and operates the project during the term of the ground lease.
Hotel operation & maintenance
During the ground lease term, the university receives annual lease payments, and AJ receives the hotel’s net cash flow. The hotel reverts to the university after the lease.
CLASS® Program Partnerships
CLASS® Program Partnerships are public-private partnerships that provide business and real estate consulting services to colleges and universities. CLASS® helps them manage, operate, finance, and develop assets in the hospitality field, including hotels, restaurants, and other hospitality facilities.
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