Phoenix<\/strong>\u2014DiamondRock Hospitality Co. has announced the purchase of L’Auberge de\u00a0Sedona, a luxury resort, and Orchards Inn Sedona, an adjacent hotel, both located in Sedona, Ariz. The properties traded in an off-market transactions for the contractual purchase price of $97 million.<\/p>\n“This acquisition represents a rare opportunity to own two high-quality resort properties in a coveted, high barrier-to-entry resort market. While we believe the initial pricing of the deal is attractive, we have identified significant opportunities to increase profitability through the implementation of our well-proven asset management practices and thoughtful capital enhancements,” Mark Brugger, president & CEO of DiamondRock Hospitality Co., said in a prepared statement.<\/p>\n
The 88-key L\u2019auberge and the adjacent 70-key Orchards Inn are located in the heart of Uptown Sedona and they both offer 5,000 square feet of meeting space and two restaurants. Starting with 2015, more than $14 million were invested into the resorts, including upgrades to the guest rooms and the refurbishment of the two restaurants. Diamond Rock Hospitality plans to invest an additional $5 million in order to modernize the luxury cottages at L\u2019Auverge and reposition the Orchards Inn to capture additional room revenue.<\/p>\n
The acquisition has been funded with existing corporate cash and the company currently maintains more than $100 million in unrestricted corporate cash. The purchase price of the property reflects an approximately 8 percent yield and 12.6 multiple on the resorts\u2019 forecasted 2017 earnings before interest, taxes, depreciation and amortization (EBITDA). A series of planned initiatives, such as the addition of labor productivity initiatives, will drive a stabilized EBITDA of roughly $9.5 million over the next three years.<\/p>\n
Images courtesy of lauberge.com<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"DiamondRock Hospitality has acquired two resorts totaling 158 guestrooms in Sedona, Ariz.<\/p>\n","protected":false},"author":1055,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21743,21751,21742,1601,15],"tags":[34182,34183],"class_list":["post-1004167851","post","type-post","status-publish","format-standard","hentry","category-deals","category-hotel","category-latest","category-phoenix","category-west","tag-diamondrock-hospitality-company","tag-mark-brugger"],"acf":[],"yoast_head":"\n
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