Playa Hotels & Resorts N.V. Announces the Sale of Jewel Paradise Cove

Rhea-AI Summary

Playa Hotels & Resorts (NASDAQ: PLYA) has announced a binding agreement to sell the Jewel Paradise Cove resort for $28.5 million in cash to an undisclosed third party. The transaction is expected to close in Q1 2025, subject to customary closing conditions.

The company currently owns and manages a portfolio of 24 resorts with 8,627 rooms across Mexico, Jamaica, and the Dominican Republic under various brands including Hyatt Zilara, Hyatt Ziva, Hilton All-Inclusive, and others.

Positive

• Sale of Jewel Paradise Cove resort for $28.5 million cash strengthens balance sheet
• Maintains strong portfolio of 24 resorts with 8,627 rooms
• Diverse brand portfolio including partnerships with major hospitality brands

Negative

• Reduction in total property portfolio upon sale completion
• Transaction completion subject to closing conditions with no assurance of completion

Insights

Real Estate Investment Analyst

The $28.5 million sale of Jewel Paradise Cove represents a strategic divestment for Playa Hotels & Resorts. From a portfolio optimization perspective, this transaction aligns with the industry trend of streamlining assets to focus on core properties and brands. The sale price appears reasonable given current market conditions in the Caribbean hospitality sector.

The timing of this divestment is particularly noteworthy, as it allows PLYA to strengthen its balance sheet heading into 2025. With a current market cap of $1.46 billion, this transaction represents approximately 1.9% of the company's market value. The all-cash nature of the deal provides immediate liquidity, which could be strategically redeployed into higher-yielding properties or used for debt reduction.

For investors, this move signals management's active approach to portfolio optimization. The company's remaining 23 resorts post-sale will still provide substantial scale, while potentially improving operational efficiency and return on invested capital. The expected Q1 2025 closing timeline suggests minimal disruption to operations and a well-structured transaction process.

Hospitality Industry Analyst

This divestment reflects Playa's strategic shift towards focusing on its branded partnerships with major hospitality names like Hyatt, Hilton and Wyndham. The Jewel Paradise Cove, while a quality asset, doesn't align with the company's core strategy of leveraging global brand relationships to drive customer acquisition and loyalty.

The Caribbean all-inclusive resort market remains highly competitive and this move allows Playa to concentrate resources on properties with stronger brand affiliations and higher growth potential. The remaining portfolio of 8,627 rooms across premium beachfront locations maintains the company's strong market position while potentially improving operational margins.

This transaction demonstrates Playa's commitment to portfolio optimization and brand strategy execution. The cash consideration provides flexibility for future investments in properties that better align with their branded resort strategy, potentially leading to improved RevPAR and occupancy rates across the portfolio.

FAIRFAX, Va., Dec. 31, 2024 /PRNewswire/ -- Playa Hotels & Resorts N.V. (NASDAQ: PLYA) (the "Company") today announced that it has entered into a binding agreement with a third party to sell the Jewel Paradise Cove resort for a total consideration of $28.5 million in cash.

The sale of the resort is subject to customary closing conditions, and the Company offers no assurances that this sale will be completed. The Company expects the transaction to close in the first quarter of 2025.

About Playa Hotels & Resorts N.V.

Playa Hotels & Resorts N.V., through its subsidiaries (NASDAQ: PLYA, "Playa"), is a leading owner, operator and developer of all-inclusive resorts in prime beachfront locations in Mexico, Jamaica and the Dominican Republic. Playa currently owns and/or manages a total portfolio consisting of 24 resorts (8,627 rooms) under the following brands: Hyatt Zilara, Hyatt Ziva, Hilton All-Inclusive, Tapestry Collection by Hilton, Wyndham Alltra, Seadust, Kimpton, Jewel Resorts and The Luxury Collection. Playa leverages years of all-inclusive resort operating expertise and relationships with globally recognized hospitality brands to provide a best-in-class experience and exceptional value to guests, while building a direct relationship to improve customer acquisition cost and drive repeat business. For more information, please visit www.playaresorts.com.

Forward-Looking Statements

This press release contains "forward-looking statements," as defined by federal securities laws. Forward-looking statements reflect our current expectations and projections about future events at the time, and thus involve uncertainty and risk. The words "believe," "expect," "anticipate," "will," "could," "would," "should," "may," "plan," "estimate," "intend," "predict," "potential," "continue," and the negatives of these words and other similar expressions generally identify forward looking statements. Such forward-looking statements are subject to various risks and uncertainties, including those described under the section entitled "Risk Factors" in Playa's Annual Report on Form 10-K, filed with the SEC on February 22, 2024, as such factors may be updated from time to time in our periodic filings with the SEC, which are accessible on the SEC's website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in Playa's filings with the SEC. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. The Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes after the date of this press release, except as required by applicable law. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to us (or to third parties making the forward-looking statements).

For additional information visit investors.playaresorts.com.

 

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SOURCE Playa Management USA, LLC

FAQ

How much is Playa Hotels & Resorts (PLYA) selling Jewel Paradise Cove for?

Playa Hotels & Resorts is selling Jewel Paradise Cove for $28.5 million in cash.

When is the PLYA Jewel Paradise Cove sale expected to close?

The sale is expected to close in the first quarter of 2025.

How many resorts does PLYA currently own and manage?

PLYA currently owns and manages a portfolio of 24 resorts with 8,627 rooms.

What hotel brands are in PLYA's portfolio?

PLYA's portfolio includes brands such as Hyatt Zilara, Hyatt Ziva, Hilton All-Inclusive, Tapestry Collection by Hilton, Wyndham Alltra, Seadust, Kimpton, Jewel Resorts and The Luxury Collection.

In which countries does PLYA operate resorts?

PLYA operates resorts in Mexico, Jamaica, and the Dominican Republic.