Hyatt Regency Orange County Sells for $137M
- Oct 28, 2015
The sale price represents an 11.8x multiple on the hotel’s 2015 forecast EBITDA and a 7.1 percent capitalization rate on the 2015 forecast NOI. Additionally, Xenia Hotels has retained the approximately $5.9 million balance in the hotel’s capital expenditure reserve account.
During the first half of 2015, the Hyatt Regency Orange County achieved RevPAR of $115.92, approximately 19 percent below the company’s portfolio RevPAR of $142.44 during that same period.
“This transaction allowed us to take advantage of the private market valuation for a legacy hotel in our portfolio that we expected to deliver below-average growth as additional supply is entering this competitive and relatively low-rated market. Given the market’s dynamics and the hotel’s position, we concluded that near-term capital requirements would not represent a prudent additional investment for the Company,” Marcel Verbaas, president & CEO of Xenia Hotels & Resorts, said in prepared remarks.
Eastdil Secured represented Xenia Hotels & Resorts on the transaction.
Following the property’s sale, the company estimates that its 2015 Adjusted EBITDA will be reduced by approximately $1.9 million. Excess proceeds from the disposition after repayment of the hotel’s $62 million mortgage loan will be utilized to pay off the $73 million mortgage loan the company secured for the Marriott Woodlands Waterway Hotel & Convention Center in Texas.
Image courtesy of Hyatt Regency Orange County