Investors - JUNE 23, 2014

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IN-DEPTH: Sunstone Hotel buys Hawaiian resort for $326m

by Andrea Waitrovich

Sunstone Hotel Investors has acquired the 544-room Wailea Beach Marriott & Spa, located on 22 fee-simple acres in Kihei, Hawaii, for a net purchase price of $325.7 million, or $598,600 per room. The seller is an affiliate of The Blackstone Group.



Sunstone expects to fund the acquisition, in part, with $60 million of common stock issued directly to the seller, an affiliate of Blackstone Real Estate Partners IV. The transaction is expected to close in the third quarter. 

The purchase price represents a 16.9x multiple on 2014 forecasted hotel EBITDA of $19.3 million and a 5.2 percent capitalization rate on 2014 forecasted hotel net operating income.

Sunstone expects to fund the balance of the purchase price with proceeds from the issuance of common stock. Additionally, Sunstone exp

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