Superior Homes & Investments LLC of Clermont paid Rani International $19.85 million for the 90%-occupied hotel. Twenty prime acres of adjoining net developable land was included in the deal.
The economic fallout from Sept. 11 and "a suffering hotel market" plagued the sale for two years, Susan Morris, senior vice president in the Orlando office of Colliers Arnold Commercial Real Estate Services Inc., tells GlobeSt.com.
"After 9/11, the hospitality industry clearly came out with a proven theory that timeshare and hotel/condos were the preferred product line of the leisure industry because of their proven ability to be less sensitive to the downturns of the market," Morris says. "The hotel was originally built as a staging area for vacation packages to market timeshare," Morris notes. "We sold off their timeshare component but could not market [the entire property] on an income basis because it had never been operated that way." However, when the market turned, "the big condo conversion craze allowed us to create value in the hotel, as well as the developable acreage."
The 20 acres, approved by Orange County for hotel and timeshare development, is valued at about $11 million or $550,000 per acre ($12.63 per sf), Morris says. The tract is located to the south and in front of the hotel with some of the land on Lake Eve.
Brokers Kane Morris-Webster and Jill Rose worked with Morris on the deal and represented Rani. Gene Soyka of Exit Realty in Boca Raton negotiated for the buyer. The deal took about five months to complete, from contract signing to closing.
The Winter Park office of Rani International, based in Johannesburg, South Africa, coordinated the transaction. Robert Stanislaw, Rani's US representative, headed the development and management of Crowne Plaza's timeshare and hotel project and also developed the property's disposition strategy, Morris tells GlobeSt.com. The deal was done at this time because Rani is "selling off all of its US assets to concentrate on other development" categories, the broker says.
Morris says Rani owns other large-scale properties in metro Orlando, including the Tanmore DRI and the Wilderness Creek South property. The Morris team has both properties under contract. Rani formerly owned and developed Kingston Reef, an adjacent timeshare resort, which the Morris team sold in December 2002 to Trendwest Resorts. The property, renamed Worldmark by Trendwest, is now an asset of New York-based Cendant Corp. which acquired Trendwest.
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