Thayer Lodging Group has purchased the Westin Diplomat Resort & Spa, as well as several adjacent parcels and a golf course, for a total of approximately $535 million. The Annapolis, Maryland-based firm reportedly acquired the historic 998-room hotel, located in Hollywood, Florida, on behalf of its latest fund.
Thayer paid $460 million to buy the 39-story beachfront hotel from United Association, a pension plan for the 370,000-member North American and Australian plumbers and pipefitters union, also based in Annapolis. Thayer affiliates also paid $20 million for a nearby golf course and $55.5 million for numerous vacant properties at the site, which previously was managed by Starwood Hotels & Resorts.
Both Wells Fargo and The Blackstone Group helped to finance the transaction, which is one of the largest-ever hotel deals in south Florida, according to reports from local publications. Wells Fargo supplied a $260 million first mortgage for the acquisition, while Blackstone provided a $100 million mezzanine loan, according to data from Real Capital Analytics.
In May, Brookfield Asset Management acquired Thayer, marking the Toronto-based alternative asset manager’s first dedicated foray into the hotel sector. In the transaction, Brookfield’s latest fund, Brookfield Strategic Real Estate Partners, became a major contributor to Thayer Hotel Investors VI, which buys value-added hotels in major markets.
Fund VI held a final close on approximately $160 million in commitments on May 15. With Brookfield’s investment, which will match outlays made by the fund, the vehicle has approximately $320 million of total equity available. Thayer has made two prior investments on behalf of Fund VI: the Ritz Carlton San Francisco and the Hilton Los Cabos Beach & Golf Resort.