Who’s buying and refinancing?

Recent transactions include Sunstone Hotel Investors completing the purchase of The Confidante Miami Beach for $232 million; affiliates of Paceline Equity Partners acquiring the Sheraton Suites Galleria-Atlanta; and LionGrove purchasing a Wyndham Grand resort in Puerto Rico, while RobertDouglas has advised Chartres Lodging Group in refinancing its existing loan for a resort in Calistoga, CA.

Sunstone completes acquisition of The Confidante Miami Beach
Sunstone Hotel Investors Inc. has completed the acquisition of 339-room The Confidante Miami Beach for a purchase price of $232 million, or $684,000 per key. The company will invest approximately $60 million to reposition the property into a premier beachfront resort under Hyatt’s luxury, lifestyle Andaz brand.

Sunstone expects the hotel will generate an 8%-9% stabilized net operating income yield on the total investment, including the planned repositioning. The renovation program will begin in phases, starting in the fourth quarter of this year with completion expected to occur in the first half of 2024 when the hotel will debut as Andaz Miami Beach.

The company expects the property will generate $3.5 million to $4 million of EBITDA during its ownership period this year. The acquisition was funded from available cash and with $140 million of proceeds received from Sunstone’s previously undrawn revolving credit facility. Together with the expected funding for the previously announced acquisition of the remaining 25% joint venture interest in the Hilton San Diego Bayfront, which is expected to close by the end of June, the company anticipates having an outstanding credit facility balance at the end of the second quarter of approximately $240 million. Based on the company’s anticipated leverage ratio as of the end of the second quarter, borrowings on the credit facility are expected to bear interest at the rate of one-month LIBOR plus 1.5%.

Paceline affiliates purchase Sheraton Suites hotel in Atlanta
Affiliates of Paceline Equity Partners LLC, a Dallas-based private equity manager, have acquired the Sheraton Suites Galleria-Atlanta. The property is located less than one-half mile from The Battery, a mixed-use development anchored by Truist Park, home of the Atlanta Braves. Paceline acquired the hotel in an off-market transaction with the prior owner. The acquisition will be Paceline’s first strategic partnership with Highline Hospitality Partners.

The Sheraton Suites Galleria-Atlanta was developed in 1990 and underwent a complete renovation in 2013. The 278-room all-suite hotel features 4,000 sq. ft. of meeting space and a 352-space parking garage. The amenities include two restaurants, a fitness center, indoor and outdoor pool and a grab ‘n’ go market.

“The Sheraton Suites Galleria-Atlanta represents our first hospitality investment in Atlanta and seventh hotel in our portfolio,” said Sam Loughlin, CEO, Paceline. “The hotel demonstrated strong resilience through the pandemic and is poised to capitalize on The Battery’s embedded leisure and corporate demand drivers, particularly following the $12-million renovation we plan to execute in the near future.”

LionGrove acquires Wyndham Grand Rio Mar in Puerto Rico
LionGrove has purchased the Wyndham Grand Rio Mar Puerto Rico Golf & Beach Resort in Rio Grande, Puerto Rico. The resort will continue to be part of the Wyndham Hotels & Resorts family and will retain its current Wyndham Grand brand.

Wyndham Grand Rio Mar Puerto Rico Golf & Beach Resort joins the Wyndham Palmas Beach & Golf Resort as the second Puerto Rico resort to be owned and operated by the LionGrove team.

“With this acquisition, our firm grows as a unique, innovative hotel owner and operator while very favorably impacting the Puerto Rico hotel industry, economy and community,” said Chris Sariego, senior managing director/COO, LionGrove. “With our extensive expertise in the management and ownership of resort properties, we will ensure this amazing property and all of our other hotels in Puerto Rico reach the highest levels of excellence.”

The resort is located on approximately 600 acres with two miles of beachfront and views of El Yunque National Forest. The resort features 400 guestrooms; nine restaurants; two championship golf courses designed by Troon Golf; 11 Har-Tru and two Laykold tennis courts; a spa; a casino and approximately 100,000 sq. ft. of indoor and outdoor spaces for wedding events, conferences and conventions.

RobertDouglas advises Chartres on refinancing of Napa Valley resort
RobertDouglas has advised Chartres Lodging Group in refinancing its existing loan for the recently renovated, 50-key room Dr. Wilkinson’s Backyard Resort & Mineral Springs in Calistoga, CA, with an institutional balance sheet lender.

Chartres acquired the property, which is located in the heart of Napa Valley wine country, in 2019 and subsequently completed a renovation positioning the resort to a Marriott-affiliated high-end boutique. The reimagined resort includes a new restaurant and bar and a full-service spa featuring mud baths, mineral hydro tubs, steam room and massage treatment rooms, as well as multiple outdoor and indoor mineral pools.