Hyatt Hotels Corp. announced on Wednesday that a wholly owned Hyatt subsidiary plans to purchase the 1,641-room The Peabody Orlando hotel, located in Orlando, Florida, for $717 million from UST Hotel Joint Venture, Ltd.
UST Hotel Joint Venture, Ltd. is comprised of affiliates of Belz Enterprises, Memphis, Tennessee, and Estein & Associates USA, Ltd., Orlando.
Hyatt Hotels Corp., Chicago, said the transaction is expected to close on October 1, 2013 and that the hotel will be rebranded as Hyatt Regency Orlando Convention Center upon the transaction closing.
Hyatt expects the hotel to generate approximately $10 million of EBITDA in the fourth quarter of 2013 and approximately $55 million of EBITDA in 2014. Hyatt said that because the hotel recently completed a nearly $440 million multi-year expansion and renovation, Hyatt does not plan to invest significant capital in the near future.
“This transaction brings us a very high-quality hotel in one of the most popular cities in the world and enhances the Hyatt Regency brand — already a leader in meetings and conventions — with a presence adjacent to one of the largest convention facilities in the U.S.,” said Stephen Haggerty, global head, real estate and capital strategy for Hyatt. “We are confident that we will be able to build on the strong performance of this property through the depth and breadth of our relationships with meeting planners and corporate travel managers and the global strength of our brand. Orlando, the second largest hotel market in the United States, continues to benefit from strong demand from a variety of different types of guests.”
Hyatt Regency Orlando Convention Center will be the sixth Hyatt-branded hotel in Orlando, but the first large convention hotel presence for Hyatt in the market. With more than 200,000 sq ft (18,580 sq m) of meeting space — and with over 2 million sq ft (185,800 sq m) of space in the Orange County Convention Center to which the hotel is attached — the hotel will offer the most meeting space of any Hyatt Regency hotel in the U.S.