Blackstone Pays Related $153M For Fort Lauderdale Hotel
Blackstone has acquired the W Fort Lauderdale hotel as the investment giant looks to expand its global hospitality footprint.
Related Fund Management, the investment management arm of New York-based Related Cos., sold the 346-key hotel to Blackstone for $153M, two sources familiar with the deal confirmed. The price includes $97.7M for the property that is reflected in deed records and an additional $55M for the hotel operations.
The deal breaks down to around $469K per room. Blackstone made the acquisition through its Blackstone Real Estate Partners X fund, which closed last April after raising $30.4B in capital commitments.
“This transaction reflects our ability to play offense in today’s market and is a terrific opportunity for our investors,” a Blackstone spokesperson said in a statement. “We continue to have strong conviction in leisure hospitality and travel and intend to expand our footprint in this sector.”
The 567K SF hotel at 401 N. Fort Lauderdale Beach Blvd. was built on 3.8 acres in 2010 and has access to 315 feet of beachfront. Marriott manages operations at the property, which includes five restaurants, a full spa and 171 additional condo-hotel units that were not part of the transaction.
Dining options include Steak 954 from James Beard Award winner Stephen Starr, a Mexican restaurant called El Vez and the Living Room bar.
Related Fund Management, led by billionaire Stephen Ross, purchased the hotel in 2014 through the acquisition of its controlling entity, Capri Hotel LLC, along with the unsold condo-hotel units, the South Florida Business Journal reported at the time.
The deal for the two 23-story towers didn’t include a deed transfer, which prevented the disclosure of a total purchase price, but Related paid $90M for the unsold condos, which have since found buyers.
A Related spokesperson declined to comment on the sale to Blackstone.
Related went on to complete a $55M renovation of the property in 2017, and refinanced the hotel for $140M in 2018 with a loan from KKR Real Estate Finance Trust, The Real Deal reported at the time.
Nadeem Meghji and Kathleen McCarthy, Blackstone’s co-heads of real estate, told Bisnow in March that its real estate investments moving forward would be focused in the logistics, student housing, hospitality and rental housing sectors.
It sold the Arizona Biltmore hotel for $705M in January to Henderson Park, a London-based private equity real estate manager. Blackstone is also reportedly looking to sell G6 Hospitality, the holding company that owns the Motel 6 and Studio 6 brand of discount hotels, which it acquired for $1.9B in 2012.
The firm has acquired 12 hotels in Japan in the last two years, paid €50M for the Cascade Wellness resort in Portugal in September and acquired two country clubs in the United Kingdom a month later.
Blackstone executives said during the firm’s April earnings call that they believed commercial real estate values were reaching their floor and that the firm was looking to deploy some of the $191B in capital it had been keeping on the sidelines.
“I would think about this period of time as a time of seed planting,” Blackstone President and Chief Operating Officer Jon Gray said on the call.
