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Sunstone Hotel Investors has entered into a definitive agreement with an affiliate of Hyatt Hotels Corp. to acquire the 339-room The Confidante Miami Beach for $232 million, or $684,000 per key. The hotel is located on 1.5 acres of fee-simple, oceanfront land in Miami Beach and following the acquisition, the REIT is planning a $60 million repositioning of the property and will rebrand it Andaz Miami Beach.    

Once the renovation is complete, the company expects the hotel to generate an 8% to 9% stabilized net operating income yield on the total investment in the property. It also anticipates an all-in basis of approximately $900,000 per key for a fully renovated, oceanfront, luxury Miami Beach resort where valuations for similar assets are well in excess of $1 million per key, it says. 

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Erika Morphy

Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.

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