Resort for Approximately $279 Million; $213,000 per Key
October 17, 2005 - CNL Hotels & Resorts, Inc., the nation's second largest hotel real estate investment trust (REIT), announced today that the partnership in which it has a 49 percent interest has entered into an agreement with an affiliate of Whitehall Street Global Real Estate Limited Partnership 2005 to sell 100 percent of the 1,310-room Waikiki Beach Marriott Resort in Oahu for approximately $279 million. The estimated net gain to CNL Hotels & Resorts will be approximately $48 million after closing and related transaction costs.
Acquired by the partnership in 2001 from Marriott International, Inc. for $130 million, the resort's sale price represents $213,000 per key and a 3.9 percent capitalization rate based on 2004 net operating income.
According to Thomas J. Hutchison III, CEO of CNL Hotels & Resorts, the sale will enable the REIT to capitalize on favorable lodging market fundamentals and further its strategy to actively recycle capital from asset sales with opportunities to pursue selective acquisitions.
"While this is a premier destination resort, we evaluated the attractive price being offered and determined it was the right time to leverage the market cycle of this property, supporting our long-term strategy to take advantage of value-enhancing buying and selling opportunities," stated Mr. Hutchison. "We also believe this transaction reinforces the strength of our portfolio management team and our repositioning and redevelopment efforts, which included the completion of an extensive $65 million reinvestment initiative in 2002 to modernize the resort's interior and improve overall revenue potential."
CNL Hotels & Resorts intends to use its share of the sales proceeds distributed by the partnership for future acquisitions in the luxury resort and upper-upscale industry segments, as well as for other general corporate purposes. The transaction is expected to close in the fourth quarter of 2005 and is subject to customary closing conditions, though there can be no assurance that the sale will be completed.
Upon the completion of the sale, CNL Hotels & Resorts will continue to have a presence in Hawaii with its 780-room Grand Wailea Hotel Resort & Spa in Maui.
About CNL Hotels & Resorts, Inc.
CNL Hotels & Resorts, Inc. owns one of the most distinctive portfolios in the lodging industry. With a focus on luxury resorts and upper-upscale properties, the company has approximately $5.8 billion in total assets with 94 hotels and resorts across North America that operate under independent brands and corporate brands such as Marriott, Hilton and Hyatt. For more information, please visit http://www.cnlhotels.com/ .
Safe Harbor Statement Under The Private Securities Litigation Reform Act Of 1995
Certain statements and information included in this release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.
|Also See:||Otaka LP Sells the 1,304-room Hawaiian Regent Hotel to Marriott International for $125.5 million; Will be rebranded as the Waikiki Beach Marriott Resort / Nov 2000|
|CNL Hospitality Corp. Partners with Marriott in the Renovation and Ownership of the Waikiki Beach Marriott Resort / July 2001|