Miami, Fla.—South Florida-based RivieraPoint Invest + Develop recently acquired the 77-room hotel La Quinta Inn & Suites in Sebring, Fla., for $7.25 million and plans to invest $1.8 million to reposition it as an upper midscale hotel under the same flag.
The seller was Tampa-based Liberty Group of Companies. The company’s CEO, Punit Shah, is part-owner of the Miami Marlins Major League Baseball team. The off-market transaction closed on October 3, 2018.
RivieraPoint, a real estate investment and development firm, assumed a $4.74 million loan from Wells Fargo for the acquisition. The source of the remaining $4.9 million came from RivieraPoint capital and private equity raised from individual investors in Latin America and the United States.
“We were fortunate to find this off-market deal because the hotel has tremendous upside potential,” said Rodrigo Azpurua, president and CEO of Miramar-based RivieraPoint. “The planned upgrades will take this asset to the next level. The demand for well-positioned hotels in the area close to the Sebring International Raceway and many other attractions is strong. Our projections show we can achieve a 24 percent return on our investment in the next five years.”
The 10-year-old hotel, which is fully operational, has an average occupancy of 66 percent. After upgrading and modernizing the rooms, lobby, gym, meeting rooms and façade, the average occupancy is projected to jump to 80 percent. The make-over is aligned with La Quinta Inn & Suites’ efforts to improve the guest experience—dubbed LQ ‘Up.’ Liberty Group will continue to run the hotel, which will remain open during the repositioning work.
This acquisition brings RivieraPoint closer to its goal of owning 1,500 hotel rooms in the Southeast United States by 2020. The company is currently building the 155-room Radisson RED near Miami International Airport, scheduled to open in mid-2019. RivieraPoint is also building a dual brand La Quinta Inn & Suites, with 101 hotel rooms and planned under the flag’s Del Sol design, and TRYP by Wyndham, with 98 hotel rooms, near SeaWorld in Orlando. Construction of the hotels has been funded, in part, from foreign private equity and EB-5 capital. Under the EB-5 Investor Visa Program, foreign investors who invest at least $500,000 in a job-creating project can obtain a Green Card. The transaction involving the Sebring hotel, at 4115 US 27 South, did not include EB-5 capital.