Monday, August 5, 2024 Host Hotels & Resorts expands its portfolio with the acquisition of the luxurious 1 Hotel Central Park in New York and the prestigious Ritz-Carlton O’ahu in Hawaii. Host Hotels & Resorts, Inc. (NASDAQ: HST), the leading lodging real estate investment trust in the United States, today declared its purchase of the entire ownership in the 234-room 1 Hotel Central Park for around $265 million in cash.
This purchase value corresponds to an 11.1x EBITDA multiple and a capitalization rate of roughly 8.1% based on the estimated financial outcomes for 2024.
The hotel is projected to rank within the top-10 properties of Host based on the anticipated full-year results for 2024, with a forecasted Revenue per Available Room (RevPAR) of $545, Total RevPAR of $735, and an EBITDA per room exceeding $100,000. This acquisition is set to enhance the overall quality of Host’s portfolio. James F.
Risoleo, President and Chief Executive Officer, said , “We are excited to add the 1 Hotel Central Park to our portfolio and further diversify Host’s presence in New York City, one of the top performing RevPAR markets in the country. This high performing hotel will provide exposure to the luxury guest in Upper Manhattan, the top RevPAR submarket in the city. This is our third 1 Hotel acquisition, after Nashville and South Beach, and we look forward to continuing our strong partnership with the sustainable luxury brand.
” Risoleo continued , “With meaningful in-place cash flow, no near-term anticipated capital expenditures, extremely low expected supply growth, and an irreplaceable location just one block from Central Park and Fifth Avenue’s luxury shopping district, we expect the Property to drive additional value creation for our stockholders.” The 1 Hotel Central Park, which opened its doors in 2015, is a LEED Certified® luxury eco-hotel featuring 234 rooms, including 25 suites and a newly added penthouse with 5 keys, featuring expansive terraces and a presidential suite. On the lobby level, the hotel hosts Jams, a restaurant and bar operated by James Beard award-winning chef Jonathan Waxman.
The second floor provides 2,000 square feet of versatile meeting space, alongside a sunlit fitness center and a business center. Furthermore, the company is set to finalize the acquisition of the full ownership in the 450-room Ritz-Carlton O’ahu, Turtle Bay, later today. Located on the scenic North Shore of Oahu, Hawaii, this property includes a 49-acre land parcel approved for further development.
The purchase of the resort and the land parcel was made for approximately $680 million, adjusting for key money. This purchase price is equivalent to a 16.3x EBITDA multiple and a capitalization rate of about 5.
3% based on the resort’s estimated financial performance for 2024. Anticipating its rebranding as a Ritz-Carlton, the investment is forecasted at roughly a 13.5x EBITDA multiple and a cap rate of about 6.
7% for the preliminary 2025 outcomes. Risoleo continued , “In 2024, we have acquired $1.5 billion of iconic and irreplaceable hotels at a blended 13.
6x EBITDA multiple 5 . This represents over $100 million in estimated full-year EBITDA that we believe will grow as the assets we acquired stabilize. Looking back at the path to $2 billion of EBITDA we laid out just over a year ago at our investor day, we are halfway toward our target of $3 billion of acquisitions at a lower blended EBITDA multiple than assumed.
We are extremely proud of the progress we have made with these diverse acquisitions, and we remain focused on being opportunistically positioned moving forward.”.
