Resort sale price sets regional record at $220 million
Host Hotels & Resorts Inc. has completed a $220 million purchase of the waterfront Hyatt Regency Coconut Point Resort & Spa, the largest acquisition ever of a single Gulf Coast lodging property.
The Bethesda-based hotel owner bought the 454-room resort as part of an overall $1 billion deal with Hyatt Hotels Corp., the two companies indicated.
In addition to the Bonita Springs resort, Host Hotels acquired the 668-room Grand Hyatt San Francisco and the 301-room Andaz Maui at Wailea Resort, in Hawaii.
“Andaz Maui, Grand Hyatt San Francisco and the Hyatt Regency Coconut Point are exactly the type of iconic real estate we target and are located in what we believe are some of the best near-term growth markets in the U.S.,” Host Hotels President and CEO James Risoleo says, in a statement.
Host Hotels officials did not return telephone calls for additional comment.
The nation’s largest real estate investment trust focused on hotels adds that all three properties “have recently received significant capital investments and are expected to require relatively minimal near-term capital expenditures,” according to an late February earnings release.
Risoleo also described the purchases, which were purchased at a 5% capitalization rates, as “irreplaceable assets.”
The REIT notes, too, that the three hotels have “not yet reached what the company believes to be stabilized levels.”
The purchase of the Coconut Point property also comes as Florida and Lee County tourism numbers continue to hit new highs, fueled by heightened consumer confidence and solid economic fundamentals. More than 100 million visitors have traveled to or within Florida in each of the past three years, according to Visit Florida, the state’s tourism agency.
Hyatt Hotels’ President and CEO Mark Hoplamazian says the sales “supports the execution of our recently announced initiative to reduce real estate ownership as part of our broader capital strategy to unlock shareholder value.”
In all, Hyatt Hotels hopes to shed $1.5 billion worth of properties, the company says.
“If you look at the larger hotel institutional buyers, they tend to be drawn to iconic, urban convention-style hotels or destination resorts with high barriers to entry, and that’s the case with the Hyatt Regency Coconut Point.” — Daniel Peek, Tampa-based senior managing director at commercial real estate brokerage firm Holliday Fowler Fenoglio L.P. and leader of the firm’s hospitality practice.
Hyatt Hotels will continue to manage the 5001 Coconut Point resort along with the two others, under a long-term agreement with Host Hotels.
Analysts say the purchases make sense for Host Hotels.
“It’s very much in line with their strategy,” says Daniel Peek, Tampa-based senior managing director at commercial real estate brokerage firm Holliday Fowler Fenoglio L.P. and leader of the firm’s hospitality practice.
“They seek high-quality properties,” Peek says of Host Hotels. “If you look at the larger hotel institutional buyers, they tend to be drawn to iconic, urban convention-style hotels or destination resorts with high barriers to entry, and that’s the case with the Hyatt Regency Coconut Point.”
Prior to the Hyatt Regency purchase, Host Hotels owned a trio of Gulf Coast properties containing 1,043 rooms that generated an average room rate of $336.42 daily and averaged occupancy of 72.1%, according to the company’s website.
Among its Gulf Coast properties, the company owns the 450-room Ritz-Carlton Naples; the 295-room Ritz-Carlton Golf Resort, also in Naples, and the 347-room Don CeSar resort, in St. Pete Beach.
Host Hotels’ acquisition of the Don CeSar in March 2017 had set the previous record for a single Gulf Coast hospitality asset sale, at $214 million, according to company information and Pinellas County property records.
The previous Southwest Florida record had been held by the Naples Grand Beach Resort, a former Waldorf-Astoria property, which last sold for $195 million.
In addition to its rooms and waterfront location, the Hyatt Regency Coconut Point features a slate of amenities, including an 18-hole golf course; a state-of-the-art fitness center; tennis courts; six on-site restaurants or casual eateries; kayak rentals; a trio of waterslides; and a “lazy river” water feature, according to the resort’s website.
The resort, which is located between Fort Myers and Naples, also has 82,500 square feet of meeting and ballroom space for corporate and other events, the website notes.