Maryland-based Capstone Development spent $13.1 million all-in for a select-service hotel near Universal Orlando in early October, along with $61.5 million for a portfolio of five other Florida hotels that included a $9.2-million Clermont Hampton Inn, and should begin renovations within the next year, lead executives with the company confirmed for GrowthSpotter.
At roughly $74.6 million overall, all six properties were acquired from affiliate LLCs of Tennessee-based Chartwell Hospitality, which will be retained as management.
A highlight of the portfolio was the 116-room Fairfield Inn & Suites near Universal Orlando, located at 5614 Vineland Road on the southeast corner of Vineland and S. Kirkman roads, just a few blocks northeast of Universal Orlando property.
Capstone bought the property on Oct. 6 with minority investment partner The Shidler Group, a commercial real estate investment group out of Honolulu, which has a hospitality trust that invests in limited and select service hotels.
The two parties filed separate special warranty deeds for the same property. Managing partner Darren Linnartz told GrowthSpotter the total cost (including interior assets) was $13.1 million, or $112,931 per key. That's up from Chartwell's purchase price of $9.25 million back in February 2006, according to county records.
Capstone acquired five other hotels from Chartwell in a portfolio sale totaling $61.5 million, which includes properties in Estero, Stuart, Clermont and two in Naples.
The Hampton Inn & Suites in Clermont, located at 2200 E. Highway 50, sold for at least $9.2 million through two separate deeds filed by the Capstone and Shidler LLCs, based on deed doc taxes paid. A true total cost with interior assets has not been confirmed.
The six new acquisitions put Capstone at 26 properties nationwide, most of which are select-service flags from the Marriott family. These are the company's first acquisitions in the Greater Orlando area.
"The Orlando hotel fit our investment criteria well, and its an outstanding market with significant demand generators outside of just the theme park demand," said Norman Jenkins, founder and president of Capstone.
Capstone will maintain all the existing flags for the hotels, and will begin brand-standard updates and renovations within the next 12 months, he said.
"We don't have a timeline yet for the renovation investments, since we're just beginning work now on our 2016 budget. But it will be planned for next year," said Jenkins, who noted a local general contractor has not been selected.