Hotels are changing hands across the country, including the W Nashville for nearly $1 million per key.
Xenia Hotels & Resorts to acquire W Nashville
Xenia Hotels & Resorts Inc. has agreed to acquire the 346-key W Nashville for a purchase price of $328.7 million or $950,000 per key.
“We are thrilled to have reached an agreement to acquire W Nashville, an outstanding newly constructed luxury lifestyle hotel located in the desirable Gulch neighborhood in the heart of Nashville,” said Marcel Verbaas, chairman/CEO, Xenia. “The addition of W Nashville will mark the 14th property acquired since our listing on the NYSE in 2015 and aligns perfectly with our strategy of owning a portfolio of uniquely positioned premium hotels and resorts located in Top 25 markets and key leisure destinations that we expect to drive superior earnings growth. W Nashville is extremely well-designed and perfectly situated to attract year-round leisure, corporate and group demand.”
He continued, “We are excited about the earnings potential for W Nashville given its unique attributes, its status as one of the premier hotels in Nashville, the strong outlook for the market and our belief that we are in the early stages of a multi-year recovery in demand for luxury lodging.”
Having opened in October 2021, the 14-story W Nashville (shown above) features:
- Six food and beverage venues including two destination restaurants by Chef Andrew Carmellini, as well as rooftop and pool bars
- 18,000 sq. ft. of indoor meeting and pre-function space
- 26,000 sq. ft. of outdoor space, including a rooftop with 360-degree views, a 10,000-sq.-ft. pool deck and terraces contiguous with meeting, food and beverage and event spaces
- Six street-level entrances to maximize accessibility and revenue generation across its multiple venues
- 60 suites, more than any other luxury hotel in the market, representing more than 17% of keys, providing for the ability to capture premium leisure and corporate demand
Nashville is one of the most dynamic growth markets in the country and economic activity has accelerated in the last 18 months, as more companies increase their presence in the market, according to Xenia. W Nashville’s location in the LEED-certified Gulch neighborhood is close to corporate demand from sectors such as healthcare, the music recording industry, technology, finance, education and consulting firms.
“We look forward to deepening our relationship with Marriott International by acquiring our first W-branded property just as the W brand is being evolved and refreshed,” said Verbaas. “This asset will be our 14th Marriott-affiliated hotel across six luxury and upper-upscale brands in the Marriott brand family. We expect W Nashville to be immediately accretive to our portfolio, as reflected by indicators, such as RevPAR and hotel EBITDA/key, and believe it will be one of our top-performing assets over the years ahead. We expect W Nashville to generate between $25 million and $30 million of hotel EBITDA upon stabilization.”
The company expects to close the transaction by the end of the first quarter and fund the acquisition with available cash. The completion of the transaction is subject to customary closing conditions.
OTO Development acquires Best Western Fort Walton Beach
OTO Development has acquired Best Western Fort Walton Beach in the Florida Panhandle. A major renovation is planned.
David Altman and Robert Hunter of Marcus & Millichap represented the seller in this transaction. OTO, which is part of The Johnson Group, develops, owns and operates select-service hotels across the country.
Built in 1998, Best Western Fort Walton Beach comprises six floors and 100 guestrooms, 60 of which feature balconies overlooking the Gulf. A top-to-bottom refresh is expected to begin in September with completion slated by April 2023.
OTO is partnering with Pond, a Georgia-based engineering, architecture and planning firm, for a fully reimagined design that flows from the building’s exterior through all shared spaces and guestrooms. A gym will be added. What’s currently a small bar and tiki hut will be enhanced into a full-service restaurant with a lounge experience. A variety of structural and back- of-the-house upgrades are planned as well.
Best Western Fort Walton Beach is located less than one mile from the Destin-Fort Walton Beach Convention Center, the Gulfarium Marine Adventure Park and the Okaloosa Island Boardwalk. The hotel is part of a strong drive-to market that’s popular with leisure travelers while also catering to military and government guests with proximity to Eglin Airforce Base, Hurlburt Field and private- sector defense companies.
Mumford Company completes sale of Hilton Garden Inn of Tupelo, MS
Mumford Company has arranged the sale of the Hilton Garden Inn of Tupelo, MS. This transaction was facilitated for an affiliate of Peachtree Hotel Group. This was the second transaction by Mumford on behalf of PHG in recent years. The deal required buyer assumption of a CMBS loan.
The purchaser was 363 Tupelo LLC, an affiliate of Aurora Capital, Brewer Realty and LRC2 Properties, multi-property owners with significant hospitality holdings. The property will be operated by LRC2 Management LLC. The new owners plan extensive renovations and will continue to operate as a Hilton Garden Inn.
Steve Kirby, Mumford’s managing principal in Atlanta, and Ed James, managing principal in Newport News, RI, represented the seller in the transaction.
Hodges Ward Elliott arranges sale of three-property portfolio
Hodges Ward Elliott (HWE) has arranged the sale of a three-property, 376-room hotel portfolio, located in the Portland and Eugene, OR, and Pittsburgh submarkets.
The portfolio consists of the 137-room Aloft Hillsboro-Beaverton built in 2017; the 120-room Home2 Suites Eugene Downtown University Area built in 2016; and the 119-room Home2 Suites Pittsburgh/McCandless built in 2013.
The properties were developed, owned and operated by the seller, Widewaters Hotels of Syracuse, NY. HWE led a competitive marketing process for that garnered heavy interest and received multiple bids from a diverse array of buyer types that ultimately led to a single transaction with Peachtree Hotel Group.
“The sale of these assets further demonstrates investor interest in the select-service category,” said Clint Hodges, managing director, HWE. “We were pleased to find a single buyer for this portfolio of well-built, premium hotels in growing Northeast and Northwest submarkets.”
Hotel Van Zandt Sold
Hodges Ward Elliott (HWE), arranged the fee-simple sale of the Hotel Van Zandt, a 319-room luxury lifestyle hotel in downtown Austin, within the city’s Rainey St. District.
An HWE team led by Daniel Peek, hotel group president; John Bourret, managing director; Austin Brooks, director; and David Auer, VP, advised the seller in the negotiations.
“HWE conducted a very targeted campaign to market the sale of the Hotel Van Zandt,” said Bourret. “The result was a competitive bid process with a variety of buyers, including REITs, private equity groups and family offices. After careful consideration, we identified a buyer making a strategic push into the Austin hotel market, and selected them for this much-admired asset.”
The Hotel Van Zandt, which opened in November 2015, offers rooms ranging in size from 330-1,100 sq. ft. and includes 52 suites among its 319 rooms. The hotel includes two food and beverage outlets; approximately 25,000 sq. ft. of flexible meeting and event space; and a fourth-floor pool deck with views of Lady Bird Lake.
