New Hospitality Startup Pays $80M for SoCal Hotel
Dune Drifter was co-founded by the grandson of Marriott International Executive Chairman Bill Marriott.
By Nick Trombola August 14, 2024 3:40 pm
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A hospitality startup with familial ties to the Marriott family has gotten its hands on a beachfront hotel in sunny Laguna Beach, Calif.
Dune Drifter, a new California-based firm led by investors Cramer Williams and Chris Harrison, has paid $80 million, or $640,000 per key, for the Pacific Edge Hotel at 647 South Coast Highway, one of the priciest recorded hotel sales in the Golden State so far this year, according to the Orange County Business Journal. The sellers, Highgate and Morgan Stanley (MS), had acquired the 125-room hotel for $57.5 million in 2017.
The new owners want to renovate the property, which could ultimately cost the equivalent of $1 million per key, per the Business Journal.
Williams and Harrison are both managing partners at Houston-based Dauntless Capital Partners, a private equity firm founded in 2019 by Williams that focuses on hospitality investments (though Dauntless was not involved in the deal). Harrison is the grandson of Bill Marriott, executive chairman of Marriott International.
Patrick Deming of Eastdil Secured helped broker the sale, according to the Business Journal.
A representative for Dune Drifter could not be reached for comment. Former owner Highgate did not immediately respond to a request for comment.
Built in 1963 on beachfront real estate in Orange County, Calif., the 44,700-square-foot hotel comprises nine buildings split across 11 parcels.
The Pacific Edge trade comes about a month after Braemar Hotels & Resorts’ $165 million sale of the Hilton La Jolla Torrey Pines in La Jolla, Calif., about 15 miles north of Downtown San Diego. JRK Property Holdings acquired the nearly 400-key resort, which is adjacent to the famed Torrey Pines Golf Course, via capital from its $350 million Hospitality Fund. The sale is one of the largest single-asset trades in California so far this year.
Nick Trombola can be reached at NTrombola@commercialobserver.com.
