Dive Brief:
- Hyatt Hotels Corporation has completed the sale of the Hyatt Regency Orlando and an adjacent 45 acres of land to affiliates of Houston-based RIDA Development Corporation and an Ares Management real estate fund for approximately $1.07 billion, the company announced Friday.
- The deal marks “the largest single-asset sale in Hyatt history,” CEO Mark Hoplamazian said in a statement. With 1,641 keys, Hyatt Regency Orlando is the fourth-largest Hyatt hotel globally by room count, the company shared.
- The sale is part of Hyatt’s broader capital allocation strategy to sell its owned hotels and reinvest the proceeds in “asset-light platforms that accelerate growth,” according to the company. In 2021, Hyatt committed to disposing of $2 billion in assets — a goal the company has now surpassed.
Dive Insight:
RIDA and Ares will develop a new Grand Hyatt hotel on the 45 acres of land adjacent to Hyatt Regency Orlando. Hyatt and an affiliate of RIDA and Ares plan to enter into a long-term management agreement for the hotel “upon the satisfaction of certain conditions,” Hyatt shared.
On average, Hyatt Regency Orlando welcomes more than 1 million guests and event attendees annually. The hotel is connected directly to the second-largest convention facility in the U.S., the Orange County Convention Center, Hyatt said. The hotel itself offers 315,000 square feet of flexible event space.
In May, Cvent named Orlando the top meetings destination in North America out of 50 markets.
Hyatt Regency Orlando is also within a 15-minute drive from top Orlando demand generators, such as Walt Disney World and Universal Studios, according to a separate release from JLL’s Hotels & Hospitality group obtained by Hotel Dive. JLL arranged $620 million in financing for the sale.
The planned Grand Hyatt Orlando is expected to have 2,500 rooms, which will be developed in multiple phases. When complete, the development will create a combined total of more than 4,000 rooms across the Hyatt Regency and Grand Hyatt.
RIDA and Ares expect they will pursue “necessary approvals and other governmental support” over the next few years for the planned development — “collaborating on a visionary public-private partnership with the State of Florida, Orange County, the OCCC, and all community stakeholders,” according to RIDA President and CEO Ira Mitzner.
Hyatt’s asset-disposition initiative has now realized $2.6 billion of gross proceeds, net of acquisitions, for the company, according to the release.
In a May earnings call, Hoplamazian said the company had generated $1.5 billion in gross proceeds from the disposition of assets and was “confident” the remaining portion of the $2 billion disposition committed would be achieved by year-end.
The company first decided to go “asset-lighter” in 2017, Hoplamazian said in an April interview with The Wall Street Journal.
