DiamondRock Hospitality Acquires Cavallo Point, The Lodge at The Golden Gate Bridge, in Sausalito, California
December 13, 2018 1:04pm
BETHESDA, Md., Dec. 13, 2018 -- DiamondRock Hospitality Company (the "Company" or "DiamondRock") (NYSE: DRH) today announced that it has acquired Cavallo Point, the Lodge at the Golden Gate ("Cavallo Point," the "Hotel," or the "Lodge"), a premier luxury hotel located in the Golden Gate National Recreation Area in Sausalito, California. Cavallo Point is situated at the base of the Golden Gate Bridge with sweeping views of the San Francisco Bay. The Lodge has consistently been recognized by Conde Nast Traveler and Travel + Leisure as one of the top luxury hotels and one of the most sustainable in the world. The acquisition represents a 12.8x multiple on trailing twelve month EBITDA.
Cavallo Point enjoys one of the most unique and attractive locations in the San Francisco Bay Area as an integrated part of the scenic waterfront community of Sausalito with breathtaking views of the Golden Gate Bridge. The Hotel, which achieved LEED Gold certification for its environmentally sustainable design and construction, spans 45 acres and features 142 guest rooms and suites with over 14,600 square feet of meeting space, as well as entitlements for significantly expanding the property in the future. The Hotel's expansive collection of amenities features the award-winning Murray Circle restaurant and Farley Bar, Cavallo Point Cooking School, Healing Arts Center & Spa, outdoor pool, fitness center, retail space and art gallery.
The acquisition of Cavallo Point has many portfolio benefits for DiamondRock, including increasing the Company's exposure to West Coast markets, the resort segment, and independent hotels. In addition, the Hotel will be the Company's second highest RevPAR ($306) property and highest Total RevPAR ($809) hotel. The Company does not anticipate the Hotel to materially contribute to the Company's EBITDA during the remainder of 2018.
"Cavallo Point is a truly unique opportunity to acquire an irreplaceable, luxury asset in the San Francisco market, which increases both our resort and San Francisco exposure," said Mark Brugger, President and Chief Executive Officer of DiamondRock. "This acquisition is consistent with our strategy to invest in high-quality destination resorts in high barrier-to-entry markets. With its unique location and wide range of services and amenities, Cavallo Point competes with many of the top luxury resorts in Northern California, as well as hotels in San Francisco's central business district. Furthermore, we see numerous opportunities to utilize our asset management best practices, as well as implement other value-add expansion opportunities."
Ideally situated in one of the highest-barrier-to-entry markets in the United States, Cavallo Point provides easy access to the world-class business and leisure destinations of the Bay Area. The Lodge is a short walk to downtown Sausalito, seven miles from San Francisco's central business district, and in close proximity to the premier wine regions of Napa and Sonoma.
Because of its proximity to San Francisco, Northern California and Silicon Valley, Cavallo Point has consistently attracted a diverse regional and international clientele. San Francisco, the financial headquarters of the Western United States, is home to 35 Fortune 500 companies, many of which operate in the technology, biotechnology and life sciences industries. In addition, San Francisco is home to the Moscone Center, its largest convention, exhibition and meeting facility, and the Golden State Warriors' $1 billion Chase Center arena and entertainment center slated to open in Fall 2019. The Moscone Center recently completed a multi-year $500 million renovation and expansion, which is expected to drive record citywide room nights in 2019 and 2020.
Cavallo Point is situated within the Golden Gate National Recreation Area, within easy walking distance to a marina, a yacht club, and the Bay Area Discovery Museum. The Hotel opened in 2008 following an extensive two-year redevelopment that included 74 newly constructed guest rooms and a spa, and 68 restored historic guest rooms, as well as the rehabilitation of several other historic buildings that now house the restaurant, bar, cooking school, retail, art gallery and meeting spaces.
Cavallo Point will continue to be managed by Passport Resorts LLC, a San Francisco Bay Area hotel management company, known for its management of high-end destination resorts, including the Post Ranch Inn in Big Sur, California. Passport Resorts' properties are located in iconic settings and provide guests with first-class services, amenities, and cuisine. Passport Resorts' business practice is to operate its properties in an environmental and socially responsible manner.
The acquisition was funded through a combination of cash on hand, proceeds from a new unsecured term loan and the issuance of common limited partnership units in the Company's operating partnership ("OP Units"). The Company issued 796,684 OP Units in connection with the transaction at $11.76 per unit. Additionally, the Company has entered into a new five-year $50 million unsecured term loan for purposes of maintaining qualified non-recourse debt associated with the property. The interest rate on the term loan is based on a pricing grid ranging from 140 to 220 basis points over LIBOR, based on the Company's leverage ratio. The interest rate is currently 145 basis points over LIBOR.
diamondrock hospitality company,
lodge at golden gate,
DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in top gateway markets and destination resort locations. The Company owns 31 premium quality hotels with over 10,000 rooms. The Company has strategically positioned its hotels to be operated both under leading global brand families such as Hilton and Marriott as well as unique boutique hotels in the lifestyle segment. For further information on the Company and its portfolio, please visit DiamondRock Hospitality Company's website at www.drhc.com.
Contact: Jay Johnson
Pebblebrook Hotel Trust Completes Sale of the Liaison Capitol Hill
Sandpiper Lodging Trust Acquires Four WoodSpring Suites Hotels From Wills Capital Partners
IHG Acquires Six Senses Hotels Resorts Spas From Pegasus Capital Advisors for $300 Million
Snow King Resort Hotel in Jackson, Wyoming, Purchased by KDG Capital
Avantgarde Hospitality Acquires The Ivy Boutique Hotel in Chicago, Illinois
Kingwood International Resorts Acquires Reunion Resort in Central Florida
Sawyer Realty Holdings Acquires 130-Room Residence Inn by Marriott Boston Tewksbury/Andover in Massachusetts
Rockbridge Acquires The Tennessean Hotel and Holiday Inn Knoxville Downtown Hotel
Paramount Lodging Advisors Sells Ocean Front Gold Beach Inn, Ireland’s Rustic Lodges & RV Park and Ireland’s Commercial Income Property in OR
Red Planet Japan to Acquire Thailand Hotel Portfolio From Parent Company Red Planet Hotels LImited for $60 Million
AWH Partners Acquires 100-Acre Topnotch Resort and Spa in Stowe, Vermont
Pacifica Hotels Acquires Residence Inn by Marriott Anaheim Hills Yorba Linda
GreenTree to Acquire Majority Stake in Argyle Hotel Management Group (Australia) Pty Ltd.
Deutsche Acquires 51% of Zleep Hotels, Its Fifth Brand
Kennedy Wilson Sells the Ritz-Carlton, Lake Tahoe for $120 Million
McNeill Hotel Investors Acquires Hampton Inn & Suites by Hilton and Springhill Suites by Marriott in Columbia, Maryland
Golden Entertainment Completes Acquisition of Two Laughlin, Nevada Casino Resorts From Marnell Gaming
The LCP Group and Blue Vista Capital Management Acquire 347-Room Hilton Kansas City Airport
Lindsay Goldberg Acquires Affordable Suites of America
Host Hotels & Resorts Closes $302 Million Sale of the Westin New York Grand Central Hotel
Please login or register to post a comment.