Sunstone Hotel Investors To Acquire Wailea Beach MarriottJune 19, 2014, 12:34 PM HST · Updated June 19, 12:46 PM 0 Comments
By Wendy Osher
Sunstone Hotel Investors today announced that it has entered into an agreement to acquire the 544-room Wailea Beach Marriott Resort & Spa in South Maui.
The acquisition is being made at a net purchase price of $325.7 million, according to the real estate investment trust.
The Wailea Beach Marriott is located on 22 acres of land on Wailea Beach and is adjacent to the high-end Shops at Wailea retail center.
Ken Cruse, CEO at Sunstone Hotel Investors commented in a press release announcement noting that the Wailea property is the company’s first acquisition in the Hawaii market. “This acquisition fits squarely within our strategy of increasing our portfolio quality and scale while improving our financial flexibility,” he said.
Cruse called Wailea “one of the most attractive and supply-constrained leisure and group destinations in the United States.” He said, “While the Hotel currently produces superior RevPAR relative to our portfolio average, we believe the hotel’s market penetration, cash flows and long-term value will materially benefit from our asset management process and a carefully-planned and executed repositioning program.”
The company plans a renovation of the hotel in 2015 and 2016.
Cruse said the company will receive operational support during the planned renovation from Marriott International, the hotel’s manager.
According to the announcement, Sunstone Hotel Investors expects to fund the acquisition in part with $60 million in common stock, with the balance coming from proceeds from the insurance of common stock.