JRK Property Holdings, through its $350 million hospitality fund, has acquired a two-property, 275-key Hyatt-branded hotel portfolio in San Juan, Puerto Rico from the PRISA Group for an undisclosed price. Other terms were not disclosed.
The portfolio comprises two premium select-service hotels located within the Puerto Rico Convention District: the 149-room Hyatt Place San Juan and 126-room Hyatt House San Juan. Developed by the seller within the past eight years, both properties have been recently renovated including lobby refresh, updated F&B outlets, and guestroom and corridor improvements. Both properties were designed to meet the demands of San Juan’s vibrant leisure, corporate and tourism business with resort style pools, fitness centers and meeting and event space.
The hotels benefit from numerous demand drivers including their proximity from the 600,000-square-foot Puerto Rico Convention Center, the largest and most technologically advanced conference facility in the Caribbean; and the Distrito T-Mobile, a 476,000-square-foot entertainment, dining and performance venue, which attracted three million visitors in 2022.
JRK’s Hospitality Fund focuses on full- and select-service hotels for opportunistic and value-add investments across the nation. The fund targets transactions of more than $25 million and up to $1+ billion for portfolios, which would be made through its fully discretionary fund comprised of high-net worth individuals, or through joint ventures with strategic partners.
This is the first investment outside the continental United States for JRK, which hopes to build its hotel portfolio in Puerto Rico, according to Head of Hotel Investments Shaan Bhatia.
“San Juan is one of the strongest RevPar markets in the United States, with consistently strong occupancy and a healthy growth trajectory,” Bhatia said in a statement. “The expected rate cuts by the Fed in 2024 should stimulate discretionary spending, which would only serve to improve Puerto Rico’s already resilient hospitality fundamentals.”
“The Puerto Rico hotels deliver tremendous going-in cash flow to our investors on new institutional quality construction while offering several levers for additional value creation,” added JRK President Daniel Lippman. “We’re thrilled with the continued expansion of our national hotel portfolio and look forward to finding similarly compelling opportunities in 2024.”
San Juan trails only New York City and the island of Oahu in average occupancy, commanding a 74.7 percent average occupancy rate since 1994, according to JLL’s Hotels and Hospitality Group, which marketed the portfolio on behalf of the seller. Members of the JLL team included Andrew Dickey, Maciej Polek and Mark Fisher.