Holiday Inn Express on the Block in Waikiki
A high-rise hotel in Honolulu’s popular Waikiki section is on the block with expectations that bids will approach $225 million.
The 596-room Holiday Inn Express Waikiki, which opened two years ago following an extensive renovation, has an estimated value of roughly $375,000/room, or $223.5 million. Eastdil Secured is representing the owner, a joint venture between C.V. Starr & Co. of New York and Clearview Hotel Capital of Newport Beach, Calif.
A sale would mark a quick turnaround for the property. The joint venture acquired it for $102.6 million in 2015, when it operated as the Maile Sky Court Hotel, and conducted a $30 million renovation. The hotel reopened in February 2017, touted as the largest Holiday Inn Express in the U.S.
The property is offered subject to a franchise agreement that runs until 2042 with InterContinental Hotels, the U.K. company that operates the Holiday Inn brand. But in 2022, a buyer would have the option of either rebranding half the rooms with another flag, operating them as a separate, independent hotel or selling them off as time-share units.
The property is still ramping up its performance to be in line with its competitive set. On average, upper-midscale hotels in Waikiki were 83.1% occupied last year, up from 82.7% the previous year, according to STR. Rates grew 3.8% to an average of $150.31/room, pushing revenue up 4.4% to $124.97/room. Marketing materials note that visitor arrivals to the island of Oahu were up 4.4% in the year ending in November, with average stays and spending per visitor also increasing.
The 43-story building was completed in 1984. The rooms are above a five-level podium that contains the lobby, three levels of parking that generates revenue, and retail space. There is an outdoor pool, a sky deck and fitness and business centers.
The hotel is at 2058 Kuhio Avenue, about a block from the high-end shopping district along Kalakaua Avenue and three blocks from Waikiki Beach.