CNL arranged a $1.1-billion, short-term credit contract with an affiliate of Deutsche Bank AG to cover the 3,531-room deal. CNL also assumed KSL's long-term debt of $794 million. KSL will continue to manage the properties until a permanent manager is selected.
The acquisition includes the 780-room Grand Wailea Resort & Spa on Maui, Hawaii; the 796-room La Quinta Resort & Club and PGA West in La Quinta, CA; the 692-room Doral Golf Resort & Spa in Miami; the 738-room Arizona Biltmore Resort & Spa in Phoenix; the 279-room Claremont Resort & Spa in Berkeley, CA; and the 246-room Lake Lanier Islands Resort near Atlanta.
CNL Hospitality CEO Thomas J. Hutchison III says the deal makes his firm the second largest hotel REIT in the US with a portfolio of 32,500 rooms in 136 hotels in 37 states and Canada boasting 19 nationally recognized brands. Hutchison says the portfolio's total assets are valued at "more than" $6 billion.
"The KSL acquisition directly aligns with our long-term investment strategy to assemble a quality, robust portfolio, while further broadening our overall diversification," the CEO says.
CNL Financial Group Inc., the locally based parent of CNL Hospitality Properties, is one of the largest privately held real estate investment and finance companies in the US. CNL Financial and the entities it has formed or acquired have $12 billion in assets, representing 4,000 properties in 49 states and Canada.
KSL was created in 1993 by New York-based investment firm Kohlberg Kravis Roberts & Co. KSL sold the six properties according to a previously defined strategy of selling long-held assets, hospitality industry brokers tell GlobeSt.com. The company expects to invest the sale proceeds in other hotel or commercial real estate investments.
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