Boykin Lodging Company (NYSE: BOY), a multitenant hotel real estate investment trust, has signed a binding contract to buy the 208-suite Pink Shell Beach Resort in Ft. Myers Beach, Florida. The transaction is expected to close in the second quarter, subject to approval by the seller’s limited partners.
“The Pink Shell is a beautiful beach resort and an exceptional investment opportunity,” said Robert W. Boykin, chairman, president and chief executive officer of Boykin Lodging Company. “It will be the fourth resort we have purchased in the last twelve months and fits in well with our strategic plan. The acquisition will be accretive to our earnings, and we are pleased to be acquiring such an irreplaceable asset at an attractive net price to us.”
The Pink Shell Beach Resort occupies 12 acres on Estero Island near the Sanibel-Captiva Island Causeway. The resort boasts 1,500 feet of beachfront and a bay-front marina. Boykin would also acquire development rights to add approximately 5,000 square feet of meeting space and over 30 additional units.
“In keeping with Boykin’s multitenant strategy, South Seas Resorts, the Pink Shell’s current operator, would lease and continue to manage the property,” Mr. Boykin said. “This would be the fourth third-party tenant-manager with which we have become allied in the last nine months. Our flexibility in accommodating sellers and operators allows Boykin Lodging to complete acquisitions of attractive assets under terms profitable to all involved.”
“The Pink Shell is a good example of how our strategy allowed us to reach an agreement that others could not,” Mr. Boykin said.
Under the agreement, Boykin would pay $21,250,000 for the resort. $2 million of the purchase price would be funded by South Seas Resorts under the terms of its ten-year lease arrangement with Boykin. Boykin’s net price for a 100 percent equity interest in the resort would be $19,250,000.
“Our arrangement with South Seas Resorts illustrates our strategy of working with tenant-managers whose financial interests are aligned with ours,” continued Mr. Boykin. “The South Seas contribution toward the purchase price of the resort is a profitable move on South Seas’ part and was a significant factor in our decision to proceed with the transaction.”
Bob Taylor, Chairman of South Seas Resorts, commented, “This arrangement allows South Seas to retain a profitable arrangement with the Pink Shell while adding the support of the capital resources of a public company like Boykin.”
South Seas Resorts is one of the largest owners and operators of upscale beachfront destination resorts and hotels in Florida. South Seas operates ten resorts and hotel properties along the southwest coast of Florida including locations on Sanibel, Captiva, and Marco islands, and Clearwater. South Seas’ flagship property is South Seas Plantation on Captiva Island.