News Summary
Certares Management has acquired the historic Hilton New Orleans for $47 million, representing a significant investment in the city’s hospitality sector. This purchase underscores the company’s interest in high-quality hotel assets in growing markets. The acquisition, at approximately $187,000 per room, is seen as a boost to New Orleans’ tourism recovery and follows Certares’ strategy of expanding its hotel portfolio, including recent investments totaling nearly $300 million. The Hilton New Orleans, known for its distinctive architecture and amenities, marks a key opportunity for revitalizing a historic property.
New Orleans, Louisiana – Certares Management, a New York City-based real estate investment group, has acquired the historic Hilton New Orleans located at 333 St. Charles Avenue for $47 million. This strategic purchase signals Certares’ continued interest in high-quality hotel assets, particularly in markets poised for growth such as New Orleans.
The acquisition price breaks down to approximately $187,000 per room, based on the hotel’s 252-room capacity. It is reported to represent a 10.1x multiple on 2024 Hotel Adjusted EBITDA. Certares has been actively involved in the hotel sector, amassing nearly $300 million in acquisitions, including 15 hotels in the past two years. Earlier this year, the investment group purchased the Sea Crest Beach Hotel in Cape Cod for just under $54 million.
The Hilton New Orleans, originally designed by architect James Gallier, Sr. in 1845, began its life as the Commercial Exchange and later served as a Masonic Temple for the Grand Lodge of Louisiana. After undergoing a hotel conversion in 1982, it reopened as the Hilton in 2007 following extensive renovations. The hotel’s distinctive Neo-Gothic architecture completed in 1926 has made it a recognizable landmark in the city.
The building’s transition to a hotel came after it was previously branded as the Kimpton Monaco, which closed after Hurricane Katrina due to insurance disputes. Over the years, the previous owner, Sunstone Hotel Investors, acquired the property in 2013 for $59.35 million but opted to sell it at a loss due to the decision not to invest in renovations to maintain competitiveness in the hospitality market.
Certares’ acquisition is viewed as a vote of confidence in New Orleans’ hospitality industry, as indicators show a recovery in tourism and a robust convention calendar. The Hilton New Orleans features not only an indoor pool, but also a well-known restaurant, Luke, offering a Creole-style culinary experience under the ownership of chef John Besh’s BRG Hospitality.
The sale aligns with Sunstone’s ongoing strategy to streamline its portfolio by selling underperforming properties and focusing on higher-yielding investments, such as repurchasing its own shares. Despite previous struggles faced during the COVID pandemic, Sunstone has reported a recovery in financial performance and sought to resolve issues with its less profitable assets.
Experts in the hospitality industry have noted that the sale, along with other recent acquisitions in the area by groups such as Gencom and Caesars Entertainment, reflects a sustained interest in New Orleans’ tourism potential. With various conventions and events set to take place in the coming years, the outlook for the local hospitality market remains optimistic.
As Certares Management continues to expand its portfolio and make substantial investments in the hotel segment, the acquisition of the Hilton New Orleans represents both an opportunity to revitalize a historic property and an investment in the future of the city’s vibrant hospitality landscape.
Deeper Dive: News & Info About This Topic
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- Wikipedia: Hilton Hotels
- Google Search: New Orleans hotel industry
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- Encyclopedia Britannica: New Orleans
- Google News: New Orleans hotels
