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Nazarian Will Buy Morgans Hotel Group

LOS ANGELES—The deal includes outright ownership of Morgans’ three owned properties; Cain Hoy’s Jonathan Goldstein and Yucaipa’s Ron Burkle will join the SBE board of directors.

The Delano Hotel in South Beach Morgans owns the Delano in South Beach, as well as two properties in New York City and San Francisco.

LOS ANGELES—Sam Nazarian’s SBE Entertainment Group said Monday afternoon it had agreed to acquire Morgans Hotel Group for $2.25 per share in an all-cash deal with an enterprise value of about $794 million. SBE and New York City-based Morgans, credited with launching the boutique hotel trend, reportedly have held merger talks on and off over the past year.

As part of the deal, SBE is receiving a “significant investment” from Cain Hoy Enterprises, headed by Jonathan Goldstein, to help fund the acquisition. The Yucaipa Cos. will convert its existing stake in Morgans into an ownership interest in SBE. Both Goldstein and Yucaipa founder Ron Burkle will join SBE’s board of directors.

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Paul Bubny

Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.

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