Sunstone Acquires New Hotel, Marina in Key West for $175M
KEY WEST, FLA. — Sunstone Hotel Investors Inc. (NYSE: SHO) has purchased the 175-room Oceans Edge Hotel & Marina in Key West for $175 million. The newly constructed, oceanfront hotel and marina complex is situated across 20 land and water acres on Stock Island and is the largest purpose-built luxury resort and marina in Key West.
Sunstone purchased the asset from the developer, Singh Resorts, a hotel development and management firm headed by Pritam Singh. The hotel, which opened in January, will operate as an independent property and be managed by Singh Hospitality.
Oceans Edge has 86 suites, all of which have private balconies and views of the Atlantic Ocean. The hotel’s rooms are spread across four buildings and have an average size of 470 square feet, which are among the largest hotel rooms available in the Key West market, according to Sunstone.
The hotel also features six swimming pools, a full-service restaurant, waterfront bar, on-site water sports and paddle shop and a fitness facility.
As part of the transaction, Sunstone also acquired a combined 52 wet and dry boat slips and amenities in the attached marina, which offers direct deep channel access to popular fishing spots off the coast.
Sunstone funded the acquisition using available cash on hand, including proceeds from the recent sale of the Marriott Park City and Fairmont Newport Beach, as well as equity.
The acquisition comes on the heels of a hotel disposition in Utah. The Aliso Viejo, Calif.-based investor recently completed the $27.6 million sale of the 199-room Marriott Park City in Park City.
Oceans Edge is Sunstone’s first acquisition in the Key West market, which currently has the highest revenue per available room (RevPAR) of any market in the United States. Nearby amenities on Stock Island include the Key West Symphony Orchestra, Tennessee Williams Theatre, art galleries, a golf course and bars and restaurants.
Sunstone Hotel Investors Inc. is a lodging REIT that has interests in 27 hotels spanning 13,202 rooms at the time of sale. Sunstone’s hotels are primarily in the upper upscale hospitality segment and are generally operated under national brands such as Marriott, Hilton and Hyatt.
Sunstone’s stock price closed on Wednesday, July 26 at $15.89 per share, up from $13.11 per share at this time last year.
— John Nelson