Driftwood Capital Recaps $1.2B Hotel Portfolio

Driftwood Capital has bought out its minority partners in 18 hotels across several states, and merged those properties into one portfolio valued at $1.2 billion, the Coral Gables, Fla.-based firm announced. 

The recapitalization makes Driftwood the sole owner of the 4,203-key portfolio, which features properties in 10 states, including Florida, Texas and California. Previously, the hospitality investor owned the resorts alongside asset-level, non-controlling syndicated investors, according to a representative for Driftwood.

Driftwood secured a $330 million securitized senior loan with Wells Fargo (WFC) acting as an agent. Acore Capital provided $85 million in preferred equity. 

“We’ve intentionally assembled this particular portfolio of assets to reflect strength in markets, performance, and long-term fundamentals,” Carlos Rodriguez Sr., chairman and CEO of Driftwood Capital, said in a statement.

The portfolio includes three properties within South Florida, including the 150-room Canopy by Hilton West Palm Beach Downtown. The portfolio’s largest property is the waterfront Margaritaville Lake Resort Lake of the Ozarks in Missouri, which houses 520 rooms.

In recent years, Driftwood has spent $370 million renovating and redeveloping properties in the portfolio.

Last year, Driftwood closed on a $330 million fund to acquire four resorts on Florida’s Space Coast. In Miami, it’s planning to redevelop the shuttered riverfront Wharf Miami bar into a $185 million hospitality complex after residents approved a 50-year lease in 2022.

Julia Echikson can be reached at jechikson@commercialobserver.com.