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13
May

📊 Bay Street Hospitality Index: Strategy Architecture

Last Updated
I
May 13, 2025

The Institutional Rulebook for Public and Private Hospitality Investing

Sourcing & Brand/Operator Selection

Quantamental Tools: Platform Synergy Score, Operational Leverage Flag

LP Recommendation: Prioritize brand/operator deals with upside alignment, downside protection.

Market Studies, Feasibility & Valuation

Quantamental Tools: IRR Sensitivity Band, Liquidity Stress Delta (LSD)

LP Recommendation: Demand stress-tested revenue assumptions.

Deal Structuring & Financing

Quantamental Tools: Bay Adjusted Sharpe (BAS), FX Shock Modeling

LP Recommendation: Only support deals that survive multi-scenario stress paths.

Technical Oversight

Quantamental Tools: IRR Compression Index, CapEx Volatility Metrics

LP Recommendation: Institutional oversight mandatory for complex conversions.

Asset Management & Post-Close Monitoring

Quantamental Tools: Live Bay Score Drift, EBITDA Margin Tracking

LP Recommendation: Insist on real-time monitoring of underwriting drift.

Transaction Advisory & Exit Planning

Quantamental Tools: Jensen’s Alpha, Exit Liquidity Scoring

LP Recommendation: Full-cycle exit comparables must be data-supported.

Portfolio Construction with BSHI

Optimizer Inputs: Bay Score, AHA, BAS, LSD.

Outputs: Risk-budgeted portfolios, region-specific allocation files, dynamic rebalance triggers.

Component Index Methodology

• STR HOST/Trend: Total-Room-Inventory normalization

• CoStar Hotel Analytics: Submarket-tagged forecasts

• Cambridge Global PE Index: Direct private equity data

• NCREIF ODCE: Time-weighted real estate returns

• MSCI GPFI: Core+ property performance tracking

• FTSE Nareit Lodging/Resorts: Public REIT screening

• S&P Global Hotels & Resorts: Global equities coverage

• Dynamic Illiquidity Premium: 1–7.5% range modeled by hold, FX, and repatriation friction.

Conclusion

The BSHI is not simply a benchmark. It is Bay Street Hospitality’s institutional-grade rulebook—unifying fragmented data, embedding risk calibration, and making public/private hospitality investing transparent, disciplined, and scalable.

Copyright Notice and Legal Disclaimer

The materials provided by Bay Street Hospitality Fund I GP LLC (“Bay Street Hospitality”), including Bay Score, AHA, BAS, BMRI, and the BSHI system, are for informational purposes only and do not constitute investment advice. Unauthorized reproduction is prohibited. © 2025 Bay Street Hospitality Fund I GP LLC.

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