San Francisco has elevated its hospitality market over the past few years to a point where rates and occupancy have been rising and the city is a top market contender. Note the recent big money move by Carey Watermark Investors Incorporated to acquire a joint venture interest in the Fairmont Sonoma Mission Inn & Spa from owner Fairmont Hotels & Resorts. The former owner received a total of $97.1 million and will go on to manage the luxury resort under a long-term management agreement.
CWI holds 75 percent of the joint venture, which acquired the 226-key Fairmont Sonoma, bringing the company’s investment to a total of around $73.3 million. The hotel is in the midst of phase one of a ten-million-dollar renovation. By the end of the operation, the hotel will have updated all of its Heritage Rooms, its lobby and fine dining room. Follow-up improvements are planned for the facility’s spa as well as a number of other areas.
The AAA Four-Diamond hotel also underwent a 16-year long renovation process between 1984 and 2000. The facility’s Sonoma Valley setting along with its 1927 exterior is one of the Fairmont’s top assets in terms of attracting visitors. And 12,000 square feet of space are also part of the package at the location which includes a business center, fitness center, tennis courts, concierge services, gift shop, laundry service and valet parking.
CWI is sourcing $44 million of the necessary funds for the deal through debt financing. CWI’s Chief Executive Officer, Michael Medzigian, mentioned that the company is “delighted to join Fairmont on the acquisition of this world-renowned luxury resort.” The official also went on to say that once the improvements are done, the property’s value would go even higher as one of the prime Sonoma/Napa luxury properties.
Image courtesy of fairmont.com