DiamondRock Hospitality Company and Fortress Investment Group LLC Announce a Transaction for the Frenchman's Reef Marriott Resort & Spa and Noni Beach, Autograph Collection Project in St. Thomas, U.S.V.I.
BETHESDA, Md.--(BUSINESS WIRE)--DiamondRock Hospitality Company (“DiamondRock”) (NYSE: DRH), announced today that it sold the 478-room Frenchman's Reef Marriott Resort & Spa and Noni Beach, Autograph Collection project in St. Thomas, U.S.V.I. (collectively, “Frenchman’s Reef”) to an affiliate of Fortress Investment Group LLC (“Fortress”). As consideration, DiamondRock has received an upfront cash payment as well as a participation right in the future profits of the hotel once certain return metrics are achieved. The resort has been closed since it experienced devastating impact from sequential hurricanes in 2017. Under Fortress ownership, the Frenchman’s Reef will complete a major rebuilding project and reopen as a global destination resort.
“We are extremely excited to steward this important property through the completion of its ambitious rebuilding and, ultimately, to its reopening as a global destination with unrivaled facilities and amenities,” said Thomas W. Pulley, Global Head of the Fortress Credit Real Estate business. “This is a remarkable property—an irreplaceable asset that we are thrilled to add to our portfolio. We welcome the opportunity to contribute to the long-term vibrancy of the St. Thomas economy, and look forward to working closely with U.S.V.I. officials and engaging with the people of St. Thomas as an important employer.”
“We are delighted to consummate a transaction that enables DiamondRock to retain a financial interest in the future success of Frenchman’s Reef while advancing our strategy of increasing our portfolio focus on experiential drive-to resorts and lifestyle hotels,” said Mark W. Brugger, President and Chief Executive Officer of DiamondRock Hospitality Company. “We are confident Fortress will bring a dynamic and exciting vision to Frenchman’s Reef”.
Fortress Investment Group LLC is a leading, highly diversified global investment manager. Founded in 1998, Fortress manages $52.7 billion of assets under management as of December 31, 2020, on behalf of approximately 1,800 institutional clients and private investors worldwide across a range of credit and real estate, private equity and permanent capital investment strategies.
DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in top gateway markets and destination resort locations. The Company owns 30 premium quality hotels with over 9,600 rooms. The Company has strategically positioned its hotels to be operated both under leading global brand families as well as unique boutique hotels in the lifestyle segment. For further information on the Company and its portfolio, please visit DiamondRock Hospitality Company’s website at www.drhc.com.
Gordon E. Runté
Chief Financial Officer
Senior Vice President
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