Belfonti Capital Partners, LLC Acquires Former Wyndham Resort, Spa & Casino on Island of Aruba in $230 Million Transaction
Source: Business Wire - May 9, 2006
NEW YORK--(BUSINESS WIRE)--May 9, 2006--Belfonti Capital Partners, LLC today announced the acquisition of the Aruba Resort, Spa & Casino, formerly known as the Wyndham Resort, a 478-key luxury resort located in Palm Beach, Aruba in an off-market transaction valued at $230 million. Acquisition and renovation financing was provided by Wachovia Bank.
The Aruba Resort, Spa & Casino is the largest hotel in Aruba and boasts the island's largest convention and banquet spaces. The hotel also boasts the world-famous 12,000 square-foot Casablanca Casino, one of the Caribbean's premier gaming destinations.
Based in New York City, Belfonti Capital Partners, LLC is a venture capital firm focused on acquiring real estate development and investment opportunities throughout the United States and internationally. The principals of Belfonti Capital Partners, LLC, Michael Belfonti and Adam Hochfelder, have over 40 years of combined real estate development and investment experience and have collectively completed billions of dollars in real estate transactions, including most recently 485 Fifth Avenue in Manhattan.
The seller was Aruba Hotel Enterprises, NV. Carlton Advisory Services, Inc. and Credit Suisse First Boston's Hospitality Group acted as financial advisors to Belfonti Capital Partners, LLC in this transaction. The new owners plan a capital improvement campaign to further enhance the property's already stellar reputation, and will subsequently announce a re-flagging of the property.
One of only four hotels in Aruba to boast the prestigious AAA Four Diamond rating, the Aruba Resort, Spa & Casino was recognized for excellence in the 2005 Conde Nast Traveler Gold List, which catalogues the premier resort properties around the globe based on quality of accommodations, services and amenities. The Resort is located at J.E Irausquin Boulevard 77 in the Palm Beach area north of Oranjestad, one of Aruba's most popular resort destinations, just five miles from Queen Beatrix International Airport and approximately three miles from the charming shops and carnival nightlife of historic Oranjestad.
"We believe in the very strong economy and tourism trade in Aruba," said Michael Belfonti, chairman of Belfonti Capital Partners, LLC. "We are delighted with this hotel acquisition as we look to expanding on what we hope will become a major asset category for Belfonti Capital Partners."
The Resort is situated on approximately 7.5 acres of land on Aruba's famous Palm Beach and offers guests the ideal island escape. Its white sand beaches, pools, and crystal clear ocean waters are safely protected by the island's location outside of the "Hurricane Belt." The 18-floor tower provides every guest a room with a private balcony and ocean view, along with access to the 3,500-square-foot Intermezzo Day Spa, Aruba's largest full-service luxury spa and fitness center.
Despite the property's long-time reputation as one of the finest destinations in Aruba, the Resort offers significant potential for enhanced financial performance. The property, which has an irreplaceable beachfront location, opened in 1977 and was completely renovated in 1992 to the highest of standards, consists of spacious rooms with abundant amenities.
In addition, the island's hospitality market has substantial barriers to entry. The government of Aruba is actively working to improve the quality and image of tourist experience on the island and has used its powers in the past to prevent overdevelopment of unwanted resort supply. Strict development guidelines exist and the approval process for any resort development remains difficult. In addition to these legal hurdles, there are significant physical barriers to entry. The beachfront property on the island is very limited. Development sites with similar aesthetic beauty are difficult, if not impossible, to find, particularly on Palm Beach.
The property's retail space is currently 100 percent leased and has a variety of shops and restaurants, including Aruba's #1 rated steakhouse Pago Pago, and Gandelman Jewelers, the finest Jeweler in the Caribbean, offering guests the opportunity to purchase everything from Cartier and Rolex watches to diamonds and rare gems. The Resort's ideal location in the Palm Beach area north of Oranjestad, where a majority of the hotels are located, is proximate to many of the island's restaurants and shops.