ALISO VIEJO, California—Sunstone Hotel Investors, Inc. announced that it has completed the sale of the 252-room Hilton New Orleans St. Charles for a gross sale price of $47 million, or approximately $187,000 per key. The sale price represents a 10.1x multiple on 2024 Hotel Adjusted EBITDAre and an 8.7 percent cap rate on 2024 Hotel Net Operating Income. Inclusive of the company’s estimate of required near-term capital expenditures, the gross sale price represents a 13.4x multiple on Hotel Adjusted EBITDAre and a 6.6 percent cap rate on Hotel Net Operating Income for 2024. The company will provide additional details on the sale, including the impact on its previously provided 2025 outlook, as part of its second-quarter earnings release.
In anticipation of the sale of the hotel, the company recycled the proceeds from the disposition into additional share repurchases. Year to date as of June 6, 2025, the company has repurchased 6.8 million shares of its common stock at an average purchase price of $8.84 per share for a total repurchase amount before expenses of $60 million.
Bryan Giglia, chief executive officer, said, “We are pleased to announce the disposition of the Hilton New Orleans St. Charles. We were able to divest the hotel at attractive pricing, eliminate near-term defensive capital expenditures, and recycle the proceeds into a higher-yielding investment through the repurchase of our stock at a compelling discount. New Orleans remains an attractive lodging market for group events and leisure travel, and we will continue to benefit from exposure to the city through our ownership of the well-located JW Marriott. While we maintain the capacity to grow the portfolio and are evaluating hotel investment opportunities, the value we can realize through the repurchase of our stock near current levels will generally represent a more accretive allocation of capital for our shareholders. Knowing that the environment is uncertain and can change quickly, the team remains nimble and ready to pivot between capital allocation opportunities as the landscape evolves from here.”
