Carey Watermark Investors announced on Thursday that it bought a 75% stake in the 226-room Fairmont Sonoma Mission Inn & Spa.
Carey Watermark Investors, New York City, acquired the joint venture interest in the Sonoma, California, hotel from the Toronto-based Fairmont Hotels & Resorts. Fairmont will retain a 25% stake in the hotel and continue to manage it. The joint venture’s total investment in the property is approximately US$97.1 million, which was financed with US$44 million of debt. Carey Watermark’s investment is approximately US$73.3 million including its allocated portion of debt.
The first phase of an approximate US$10.7 million renovation is nearing completion and includes the updating of all Heritage Rooms, a complete redesign of the lobby and fine dining room, Santé, as well as the creation of a new lobby bar. Additional work is planned over the next two years including the spa and other areas of the property.
“The completion of the hotel’s renovations will enhance the resort making it among the best luxury properties in the Sonoma/Napa market. In combination with the strength of the Fairmont branding, the property is positioned as a leader in all aspects. Given the strong market and the high barriers to entry, this investment is consistent with our strategy of sourcing and investing in opportunities where we can joint venture with owners to maximize the current value of the asset, create a solid financial platform for future operations and achieve attractive risk-adjusted returns for our investors,” said Michael Medzigian, Carey Watermark Investors CEO.