CNL-Hilton Pays MetLife $121M for Two Hotels

ORLANDO-Locally based CNL Hospitality Corp. has grown its portfolio to 55 hotels totaling 16,500 rooms with the acquisition of two hotels in Texas and Arizona in a $121 million deal with Metropolitan Life Insurance Corp. Hilton Hotels Corp. of Beverly Hills, CA, CNL’s partner in the Dec. 24 transaction, will operate the 500-room Doubletree Hotel at Lincoln Centre in Dallas and the 428-room Sheraton El Conquistador Resort and Country Club in Tucson under a long-term management contract and will hold a minority interest in the properties. CNL will own the majority interest.

“The addition of these hotels will broaden our diversification and geographic reach, expanding our portfolio to encompass 14 hotel brands in 22 states,” says James M. Seneff Jr., chairman/CEO of CNL Financial Group Inc. CNL Hospitality is a subsidiary of CNL Financial.

The $121-million deal equates to $130,388 per key. Both properties will be converted to the Hilton brand. CNL-Hilton financed a portion of the purchase with a $78 million, five-year first mortgage loan at a fixed rate of 6%. The MetLife property acquisition follows a four-property deal CNL-Hilton completed in October 2001.

CNL is clearly on a rapid-fire acquisition track. GlobeSt.com reported just this morning that its retirement venture plunked down $89 million for 12 Marriott seniors-housing assets.

CNL Financial Group Inc. and its entities have $5.3 billion in assets, representing more than 2,850 commercial properties in 49 states. Hilton owns, manages or franchises 2,000 hotels, resorts and timeshare properties.