A trio of motels on Kissimmee’s W192 tourism corridor sold at auction Wednesday for $8.5 million in a deal that will be presented to the U.S. Bankruptcy Court on Sept. 13.
Fisher Auction Company had received a stalking horse bid prior to the opening of the auction. President Lamar Fisher told GrowthSpotter the minimum bid that would have been accepted was $8,585,000 plus a 6% buyer’s premium. The bidding period closed at 1 pm with no competing bids.
“It was a quiet one,” Fisher said. “We had seven or eight registered bidders, and they were all online watching. But no one hit their button.”
Only one of the properties, the 42-room Palm Lakefront Resort & Hostel, is currently operating. The Lake Cecile Inn & Suites and Star Motel at Lakeside were condemned by Osceola County, and the county has already issued demolition permits for them. Fisher said the purchaser would assume the obligation of demolishing the buildings.
The property portfolio was marketed as a 17.9-acre redevelopment site in the heart of the tourism corridor that is “prime for redevelopment.” It’s across U.S. 192 from Storey Lake Resort, one of Lennar Homes’ top-selling resort communities. A new $32 million wellness-themed condo hotel is going to be built right across the street.
Earlier this summer, another underperforming asset in the Kissimmee market sold for $14.28 million. European timeshare operator Hapimag divested of its only U.S. asset, the Lake Berkley Resort just south of Oren Brown Road. Hapimag COO Silvan Odermatt said the resort had been attracting fewer and fewer bookings from shareholders and members. The Hapimag community recently accounted for just 20% of the occupancy – even before the Covid-19 pandemic. The total earnings were not enough to justify future capital expenditure.
“Hapimag Resort has operated as vacation rentals, but unlike in traditional multifamily properties, the units can serve as short-term rentals or be sold to private individuals,” said Caveiro. “Despite challenging market conditions during the pandemic, which significantly impacted the tourism industry, we were able to garner a high level of investor interest and ultimately pinpoint the right buyer who was attracted to the property’s proximity to the area’s theme parks, excellent community conditions, and the investment flexibility.”
Hapimag Resort was built in 2002 and features 100 two-story townhomes and two single-family homes in the adjacent Lake Berkley Resort Villas. Units were in move-in condition, furnished and with fully-equipped kitchens, and a full-size washer and dryer.