Wells Fargo, BofA, Deutsche Bank Provide $620M Loan for $1B Hyatt Orlando Deal
RIDA Development Corporation and Ares Management Real Estate purchased the Hyatt Regency Orlando for $1.07 billion on Monday
By Brian Pascus August 19, 2024 12:01 pm
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RIDA Development Corporation and Ares Management Real Estate have secured $620 million in acquisition financing for the billion dollar purchase of the Hyatt Regency Orlando, a 1,641-key resort in Orlando, Fla.
A lender consortium of Wells Fargo (WFC), Bank of America (BAC) and Deutsche Bank (DB) provided the five-year, floating-rate single-asset, single-buy, CMBS loan, while JLL Capital Markets’ Kevin Davis, Mike Huth and Barnett Wu arranged the financing.
RIDA and Ares purchased the property from Hyatt Hotels Corp. Monday for $1.07 billion, with the price-per-room coming out to approximately $652,041. The Hyatt Regency Orlando was Hyatt’s fourth-largest hotel globally by room count.
Hyatt is expected to maintain management of the hotel under the Hyatt brand, and retain a $265 million piece of non-controlling equity in the capital stack, according to CoStar.
As part of the sale, Hyatt will provide RIDA and Ares $50 million to develop another Grand Hyatt-branded hotel on a 45-acre piece of land nearby, one that is expected to require multiple phases to complete and to eventually hold up to 2,500 rooms.
Mark Hoplamazian, president and CEO at Hyatt, said that the transaction is the largest single-asset sale in Hyatt’s history.
“We are thrilled to be working with RIDA and Ares on this transaction, and, in collaboration with these world-class developers, we will continue driving the success of Hyatt Regency Orlando and thoughtfully expand our brand footprint in the most-visited destination in the U.S. with a new Grand Hyatt hotel,” said Hoplamazian in a statement.
Located at 9801 International Drive, the 32-story hotel opened in 1986 and underwent a $450 million renovation in 2010. It includes a spa, a fitness center, six restaurants, tennis courts and an outdoor pool with waterslides, a sauna and a cave pool.
The hotel is about 15 minutes from both Walt Disney World and Universal Studios, the two most famous theme parks in the United States. The hotel isn’t just an attraction for parents and their kids: The Hyatt Regency also features 315,000 square feet of meeting space and direct connections to the Orange County Convention Center.
Ira Mitzner, president and CEO of RIDA Development, said in a statement that the deal came together through a “visionary public-private partnership” among the sponsors and the State of Florida, Orange County and the the Orange County Convention Center.
“We are excited to work with Hyatt to grow and enhance the Orange County Convention Center district and create a guest experience unparalleled for both group and leisure customers,” said Mitzner.
Brian Pascus can be reached at bpascus@commercialobserver.com
