Margaritaville Resort Sells South Florida’s Biggest Hotel Offering This Year – Commercial Observer
The hotel by the sea, located 1111 N Ocean Drive in Hollywood, Florida, has 369 rooms as well as an 11,000 square foot spa, kids’ club, and fitness center. A stay at the 6.2-acre facility ranges from $ 450 to $ 810 per night.
Pebblebrook paid $ 108.5 million in cash and assumed the existing debt of $ 161.5 million with a floating interest rate that currently stands at 2.5%. The sale is equivalent to $ 731,710 per room. The seller – Denver-based private equity firm KSL Capital Partners – bought the property for $ 190 million in 2018, The real deal reported.
The 18-story resort is expected to generate between $ 475 and $ 480 in total revenue per room in 2021, according to Pebblebrook. Overall, it is expected to generate between $ 16.8 million and $ 17.2 million in earnings before interest, taxes, depreciation and amortization also in 2021.
Based in Bethesda, Md., Pebblebrook has 52 hotels, totaling 13,000 rooms in 15 markets, according to the company.
The sale comes after a slew of other properties in Florida and Margaritaville secured financing this year. Starwood Real Estate Trust loaned $ 98.39 million for an outpost in Orlando, while Peachtree Hotel Group provided $ 104 million to complete construction of a long-standing Fort Myers Beach resort.
Since the pandemic hit the Florida hotel industry, struggling South Florida hotels have become popular assets among investors. Earlier this year, based in New Jersey Victoire investment group purchased Iconic Miami Beach Astor Hotel for $ 12.75 million. CGI Merchant Group purchased another shuttered hotel: the neighbor Celino South Beach Hotel.
But the significant acquisition of Pebblebrook portends a recovering hotel industry, thanks to the vaccine rollout and the easing of restrictions this summer. At Pebblebrook hotels, occupancy rates doubled to 41% between Q1 and Q2 2021, according to regulatory documents.
Julia Echikson can be reached at j[email protected].