Driftwood Capital Acquires Washington D.C. Metro Area Hotel
WASHINGTON, DC – Driftwood Capital, a vertically integrated commercial real estate investment, development, and lending platform specializing in hospitality, announced today that it has acquired the Hyatt Regency Fairfax, a 316-key hotel located in the Washington D.C. submarket of Fairfax, Virginia. The property was acquired for an undisclosed price. It will be managed by Driftwood Capital’s sister company, Driftwood Hospitality Management (DHM), a national hotel operator with over 20 years of expertise, and will be rebranded as a Hilton hotel.
“This is a well located asset that we were able to acquire at a great basis below its replacement cost, in one of the largest commercial office markets in the country, home to over 26 million square feet of office space dominated by government agencies, defense contractors and technology companies,” said Johannah Rodriguez, Managing Director of Acquisitions with Driftwood Capital. “Further supporting this asset’s long-term growth outlook is the lack of new lodging supply in this submarket. The only new hotels in this property’s competitive subset are located over 10 miles away.”
Added Carlos Rodriguez Sr., CEO of Driftwood Capital, “Having completed an extensive $14 million renovation in 2016, this hotel presented Driftwood Capital and its investors a unique value-add opportunity to realize significant gains in top-line performance once a new management team is in place that capitalizes on the hotel’s superior location and physical condition.”
Located at 12777 Fair Lakes Circle, the Hyatt Regency Fairfax is 13-story, high-rise hotel built in 1989. The property offers modern oversized-guest rooms, a state-of-the-art fitness center, an indoor pool with whirlpool, a full-service restaurant, and over 9,000 square feet of flexible meeting space capable of hosting up to 600 guests and 2,420 square feet of pre-function space. Following the 2016 renovation, the property was awarded a Certificate of Excellence and currently ranks #5 of 21 hotels in Fairfax County by TripAdvisor.
The centrally located hotel commands excellent interstate visibility along Interstate 66, is close to US Route 50, which offers unparalleled access to the entire DC metro area, and is just 20 minutes from Washington Dulles Airport. There is over 26 million square feet of office space located within a five-mile radius of the hotel. Nearby tenants include Boeing, Northrop Grumman, General Dynamics, CGI, Peterson Companies, the Fairfax County government headquarters, and Fair Oaks Medical Center. It is within walking distance to premier retail/lifestyle centers such as the Fair Lakes Shopping Center and East Market at Fair Lakes.
With this acquisition, Driftwood Capital’s portfolio grows to 21 full-service hotels and seven new ground-up hotel developments. Since 2015, the principals of Driftwood Capital have placed more than $700 million in capital with their investor network of family offices, high-net-worth individuals, and others, representing a portfolio of over $1 billion in hospitality assets. Among these assets are the Marriott Mission Valley San Diego, the Sheraton Park City, and the Margaritaville Lake of the Ozarks, as well as the newly opened Canopy by Hilton West Palm Beach & Canopy by Hilton Tempe.