Host Hotels & Resorts to buy 3 hotels from Hyatt

Grand Hyatt San Francisco: Photo credit: Hyatt Hotels (Grand Hyatt San Francisco)

We now know who has been negotiating with Hyatt about buying its latest tranche of hotels. Bethesda, Md.-based REIT Host Hotels & Resorts is set to acquire three hotels under the Andaz, Grand Hyatt and Hyatt Regency flags for $1 billion (with a $25 million deposit at-risk) before spring arrives.

The three hotels under contract for acquisition are the 301-room Andaz Maui in Hawaii, the 668-room Grand Hyatt San Francisco and the 454-room Hyatt Regency Coconut Point in Florida.

Hyatt announced that it was selling the properties as part of a $1.5-billion asset disposition goal last week, and CFO Pat Grismer said at the time that the company expected to close the deal by the second quarter of this year. Instead, the transaction is now slated to close by the end of the first quarter, subject to limited closing conditions, and will be funded through a combination of cash and drawing on the revolver portion of the company’s credit facility. 

"Andaz Maui, Grand Hyatt San Francisco, and 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 CEO James Risoleo said in a statement. "As the owner of 10 Hyatt properties, we truly value our unique relationship and look forward to growing that relationship in the future."

These assets are located in markets with outsized RevPAR growth that the company anticipates will outpace the country and its current portfolio. Maui and San Francisco, the company claimed, are benefitting from strong lodging demand and limited supply growth. The hotels will continue to be managed by Hyatt pursuant to long-term management agreements. The properties have recently received significant capital investments and renovations, and are expected to require relatively minimal near-term capital expenditures from the REIT.