Investor Takes Storied Property to Next Level

Additional work has recently been done on the spa and other areas of the property.

SONOMA, CA—Publicly traded REIT, W. P. Carey , has an investment strategy that provides long-term sale-leaseback and build-to-suit financing for international companies and manages an investment portfolio of more than $20 billion. It has ridden out various economic cycles and demographic shifts during its 35-year history due to an established credit and underwriting process. It has a diversified portfolio of hotels with a mix of select and full-service hotels, representing both current income and growth-oriented properties across the country. During the third quarter of 2015, its portfolio outperformed the US lodging industry as a whole with RevPAR of $156.30 versus an average of $80.82. It is no wonder that Carey Watermark Investors Inc. saw the value of the Mission Inn icon back in July 2013, when it acquired its original 75% joint venture interest from Fairmont Hotels & Resorts . With its recent acquisition of the remaining 25% interest in the Sonoma Mission Inn & Spa , its ownership stake is now at 100%. Fairmont will continue to manage the luxury resort under a long-term management agreement. The AAA Four Diamond, 226-room resort was built in 1927 on the 13-acre site of the former Boyes Hot Springs Hotel, which was developed in 1895. In 1980, major renovation returned the Inn to its 1920s grandeur, and the spa, added in 1981, attracted visitors from around the globe. Since then, renovations between 1999 and 2000 included the expansion of the spa, to its current 40,000-square-foot indoor and outdoor space. A renovation completed in  July 2013 for approximately $10.7 million included a guestroom update, a redesign of the lobby and fine dining room, Santé, as well as the creation of a new lobby bar. Since then, additional work has been done on the spa and other areas of the property to further enhance this ultimate wine country retreat. Michael Medzigian , chief executive officer of Carey Watermark Investors 1 , tells GlobeSt.com: “With the completion of significant renovation projects that include updates to the resort’s Fairmont rooms, Wine Country suites, lobby, award-winning Santé dining room and meeting space, and most recently, the addition of new poolside food and beverage venues, and several state-of-the-art spa experiences, the Fairmont Sonoma Mission Inn & Spa is positioned as a leading competitor in the Sonoma-Napa luxury full-service destination resort market. Along with the property’s history and irreplaceable architecture, setting and spa amenities, we believe the renovations will translate into solid growth opportunities and increased ADR and occupancy rates. Combining Fairmont service levels with world-class spa offerings at Willow Stream and privileges at neighboring Sonoma Golf Club, Fairmont Sonoma Mission Inn & Spa is a clear stand-out within the competitive set.” Within the 226 rooms are 60 suites and 166 guestrooms, and 12,000 square feet of interior meeting and banquet space, including a business center. There are five on-site lounges and restaurants, including Santé, a Michelin-rated fine dining restaurant. There is also a fitness center, with access to the Sonoma Golf Club and 18-hole championship course, tennis courts and an outdoor pool. For hundreds of years, ancient thermal mineral waters have graced this site. Today, the resort is proud to be one of the only luxury spa resorts in the country with its own source of thermal mineral water. “Given the strong market and the high barriers to entry, we believe that our full ownership of the property will further enhance its current value within our portfolio, and allow us to make additional strategic investments to maximize its value over the longer term,” says Medzigian.