JLL's Hotels & Hospitality group has announced that it has arranged USD 575 million in financing for the Diplomat Beach Resort, an award-winning beachfront resort with 1,000 guest rooms in Hollywood, Florida.
JLL worked on behalf of the borrower, a joint venture between real estate funds managed by Trinity Investments ("Trinity") and funds managed by UBS Asset Management's Real Estate & Private Markets Multi-Managers business, to secure the five-year, floating-rate loan through mortgage lenders, Citi and Deutsche Bank. The interest-only loan also included mezzanine financing provided by Ohana Real Estate Investors and the Canadian Pension Plan Investment Board (CPPIB).
JLL was also involved in the 2023 sale of the resort to Trinity and funds advised by UBS Asset Management, which represented the third-largest single-asset hotel sale ever in the U.S. at the time. The South Florida lodging industry saw a tremendous recovery post-Covid, making it one of the best-performing hotel markets in the country, benefitting significantly from an increase in leisure travel, recovery of group demand and the significant demographic shift into South Florida. According to JLL's State of the Florida Lodging Industry report, revenue per available room in each of the state's top 10 lodging markets beat the U.S. average in 2023.
The Diplomat Beach Resort is currently managed by Hilton Hotels and Resorts under the Curio Collection by the Hilton brand. Extensively renovated and repositioned through a comprehensive USD 90 million dollar capital plan in 2018, the Diplomat Beach Resort is a world-class beachfront meeting and events-focused resort. The resort features 1,000 guest rooms and suites and over 200,000 square feet of integrated meeting and events space. The property consists of a twin-spired, 36-story tower containing hotel rooms, a 15,000-square-foot spa, six restaurants and bars, plus multiple pools and cascading waterfalls. Additionally, the property is situated on 10 acres of Atlantic Ocean beachfront, offering kayaking, paddleboarding and jet ski rentals.
The Diplomat Beach Resort is ideally located between the two most significant airports in South Florida, Fort Lauderdale/Hollywood International Airport (10 minutes) and Miami International Airport (30 minutes), affording the resort unparalleled access to guests from major markets throughout the U.S., Latin America and Europe.
The JLL Hotels & Hospitality team representing the borrower was led by Americas CEO Kevin Davis and Managing Director Mike Huth.
"We are pleased to have represented Trinity in the financing of this iconic Florida beach resort, which is poised for outsized performance growth following a planned renovation, coupled with the ongoing strength of the South Florida lodging market," Davis said.
The Ohana Real Estate Investors team was led by President and Chief Investments Officer Franco Famularo and Managing Director Eddie Yu, partnering with CPPIB to structure the mezzanine loan.
"The Ohana credit team was grateful for the opportunity to refinance this irreplaceable property for Trinity," said Famularo.
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