Two separate hotel sales in Florida, in two separate parts of the state, show that the Sunshine State is strong for hotel transactions and valuations.
In Miami, Annapolis, Md.-based REIT Chesapeake Lodging Trust is buying South Beach's 393-room James Royal Palm for $278 million, or $707,379 per room. The property is being sold by RP Hotel Holdings LLC, which is linked to Denver-based private equity fund KSL Capital Partners.
"We are very excited to announce our entrance into the highly desirable Miami South Beach market," said James Francis, president and CEO of Chesapeake, which has a 20-hotel portfolio, including two W hotels in Chicago.
The quesiton now is, post-sale, what flag will the hotel fly? Word is Chesapeake will turn to a Starwood brand. In South Florida, Starwood licenses the Sheraton, Westin, W Hotels, St. Regis, Aloft and Element brands. HEI Hotels & Resorts will manage the hotel, Francis reportedly said.
The James deal comes on the heels of another high-profile transaction in Miami. Just last week, Marriott International sold the Miami Beach Edition hotel for $230 million to the Abu Dhabi Investment Authority, a sovereign wealth fund owned by the Emirate of Abu Dhabi.
The Miami Beach property is one of three Edition properties being sold to the Abu Dhabi Investment Authority. The first was the London Edition sold in January 2014 and Marriott expects to sell the third Edition hotel, New York Edition, in the first quarter of 2015.
Marriott is currently developing Florida's first AC Hotel nearby at 2912 Collins Avenue in Miami Beach with Robert Finvarb Companies, which is set to open in April.
Meanwhile, on the Gulf of Mexico, in Clearwater, the 416-room Hilton Clearwater Beach has been sold to a Kentucky group for $134 million, or more than $320,000 per room, reports the Tampa Bay Business Journal.
Columbia Sussex Corp., based in Crestview Hills, Ky., acquired the hotel from Blackstone Group in a transaction that closed in late January, according to Pinellas County property records.
Blackstone was represented in the transaction by HFF hotel group.
The hotel was renovated in 2006 and includes four dining options and 40,000 square feet of meeting space. It will remain a Hilton, as Columbia Sussex is entering into a long-term franchise agreement with the company, HFF said.
"This is a milestone transaction for Clearwater Beach and the Florida resort market in general," HFF's Dan Peek said in a written statement. "Like many of its resort peers, the Hilton is enjoying a robust recovery and record-breaking performance, which attracted investors from around the globe."