News for the Hospitality Executive
Lowe Enterprises Secures $100 Million Capital Investment
for Terranea Resort,
Positioning it for Long Term Success
Lowe’s Subsidiary, Destination Hotels & Resorts, Continues as Operator
LOS ANGELES--October 6, 2010 - Lowe Enterprises announced today the closing of a transaction that provides for the long-term stability of Terranea Resort, a 582-room world-class, oceanfront resort in Rancho Palos Verdes, Calif. The transaction includes an extension of the loans on the property and new capital commitments of over $100 million. The investment was made by a combination of new and existing investors in a new joint venture with JC Resorts, a San Diego hospitality company with 40 years of resort and golf experience in Southern California. Affiliates of ST Residential, LLC hold the loans on the property and are participating in the new capital commitment.
“We appreciate ST Residential’s confidence in Terranea and their diligence in working with us to reach this new agreement. In addition to being our primary lender, ST Residential has acquired the mezzanine loan on the property which demonstrates its commitment and belief in this rare property,” said Robert J. Lowe, chairman and CEO of Lowe Enterprises. “Equally important is the commitment of our existing investor group and JC Resorts. With this new partnership in place, Terranea is well-positioned to take advantage of the continuing improvement in the hotel and residential markets.”
The consummation of this transaction effectively eliminates any uncertainties about Terranea following the FDIC takeover of its original construction lender, Corus Bank, the subsequent acquisition of Terranea’s loan by ST Residential, and the challenges resulting from the recession.
“Terranea is a uniquely spectacular property. Our financial commitment to the future of Terranea demonstrates our confidence in the Lowe management team and the commitment by original investors and JC Resorts to invest in the project’s future success,” said John Barkidjija of ST Residential.
“Terranea’s spectacular oceanfront location complemented by classic Mediterranean architecture make this resort a once in a lifetime investment opportunity,” noted Paul Reed, CEO of JC Resorts. “We commend the Lowe Enterprises development team on achieving the perfect blend of California casual elegance and comfort and providing the ideal and only true oceanfront resort in the greater Los Angeles area.”
Terranea Resort opened in May 2009 and has performed very well despite the challenging economic environment. Terranea has seen an increased demand in both group and leisure travel business. Over the last year, the resort has hosted a number of high profile conferences, including the Wall Street Journal's recent "All Things Digital" conference. Terranea was also the site of a televised wedding on ABC’s The Bachelor. Terranea continues to be operated through Lowe’s hospitality management subsidiary, Destination Hotels & Resorts.
“Terranea’s restaurants, which range from fine dining to seaside casual options, also have performed exceptionally well which is testament to the enthusiastic response both from our hotel guests and the local community,” added Lowe.
Terranea Resort is situated on 102-acres of Southern California coastline just south of Los Angeles International Airport. The property was developed by Lowe Enterprises with Turner Construction serving as general contractor. In addition to the 360-room hotel and oceanfront bungalows, Terranea offers ownership in 32 private Ocean Villas and 50 Ocean Casitas, ranging in size from 1,850 to 2,800 square feet, with prices starting at $1,295,000. The resort also features 135,000 square feet of indoor and outdoor meeting and event space, a 25,000-square-foot spa and an award-winning nine-hole oceanfront golf course. Terranea’s hotel and spa were both recognized on the Conde’ Nast Traveler “Hot List” in 2010. The Links at Terranea was named the U.S. Development of the Year by Golf, Inc and one of the Best New Courses of 2009 by LINKS Magazine.
About Lowe Enterprises
Lowe’s hospitality management subsidiary, Destination Hotels & Resorts, is consistently rated one of the top 10 independent hospitality management companies in the United States with more than 30 luxury and upscale hotels, resorts and conference centers. In addition to Terranea, Destination operates properties in key metropolitan areas and resort markets including Washington, D.C., Denver, San Diego, Santa Fe, Aspen, Palm Springs, Houston and Lake Tahoe. For more information on Destinations properties, visit:www.destinationhotels.com
About JC Resorts
About ST Residential
|Also See:||Lowe Enterprises and its Partners Examining How to Restructure Terranea Resort's $320 in Loans / August 2009|