On behalf of UBS Warburg LLC, Jones Lang LaSalle Hotels has successfully arranged the sale of the Inn at Laguna in Laguna Beach, California to the privately held Classic Hotels & Resorts of Phoenix, Arizona. The 70-room, oceanfront property sold for approximately $275,000 per hotel room.
The new owner, Classic Hotels & Resorts, is a strategic management company, which emerged from the extremely successful investment, redevelopment and management of the Arizona Biltmore Resort & Spa. The company has been involved in the development, ownership and management of more than 4,000 hotel rooms in the Southwest throughout the past 20 years.
According to Arthur Buser, Executive Vice President and Head of West Coast Operations for Jones Lang LaSalle Hotels, “The property sale price fairly represents the strong investor interest in this high-barrier-to-entry, prestigious California coastal market. Additionally, since the Inn at Laguna was offered free of management and branding encumbrances, Classic Hotels & Resorts is at liberty to implement a new management system.”
The new owner intends to begin a comprehensive renovation program to further align the property with the upscale Orange County coastal resort market. “Given the recent construction of new luxury resorts in Laguna Beach and Dana Point, coupled by the existing inventory of superior hotels, the repositioning of this property as a more upscale facility will further solidify Orange County`s emerging position as the premier, top-tier coastal resort market in California,” included John Strauss, Vice President of Jones Lang LaSalle Hotels, who co-lead the transaction.
“The strength of the greater Los Angeles-area economy in recent years has contributed to the success of this market as a high-end residential and resort community,” added Strauss. “In addition to a thriving regional economy, Orange County`s positive hotel demand outlook also stems from the growth of corporate activity in Irvine and South Orange County in particular. With the Laguna hotel market occupancy already above 80 percent, significant increases in average daily rate will be further supported by the expected compression from the expanded Anaheim Convention Center and the Disneyland Park in Anaheim.”
Mark Weinstock, a partner in the Real Estate and Global Hospitality Groups of Jeffer, Mangels, Butler and Marmaro LLP, was the lead attorney representing the seller in the transaction.