BETHESDA, MD.—Host Hotels & Resorts, Inc., the nation’s largest lodging real estate investment trust, announced that it has acquired the fee simple interest in a two-hotel complex comprising the 215-room 1 Hotel Nashville and the 506-room Embassy Suites by Hilton Nashville Downtown (together, the “Property”) for approximately $530 million in cash. The acquisition price represents a 12.6x EBITDA multiple or a cap rate of approximately 7.4 percent on the Property’s 2024 estimated results.
The Property is expected to be among Host’s top-25 assets based on estimated full year 2024 results, with expected combined RevPAR of $275, Total RevPAR of $435, and EBITDA per key of $58,550, further improving the quality of the company’s portfolio.
James F. Risoleo, President and CEO, said, “We are excited to add the 1 Hotel Nashville and Embassy Suites by Hilton Nashville Downtown to our portfolio and establish a presence in one of the country’s most exciting cities. The newly built Property has a prime location in Nashville, a top performing market, which had an impressive RevPAR CAGR of 7.7 percent from 2000 to 2023, even while absorbing new supply. A major leisure destination, and the No. 2 ranked convention destination in the United States, Nashville also has a recently expanded airport and a new stadium that is expected to attract more entertainment and sporting events. With meaningful in-place cash flow, multiple demand generators, and no expected near-term capital expenditure requirements, we expect the Property will generate outsized growth as it stabilizes, enhancing the quality of our portfolio and driving additional value creation for our stockholders.”
The newly built, LEED Silver Property opened in 2022 and is located two blocks from numerous live music and entertainment venues in Nashville’s famed Lower Broadway entertainment district. The Property has a combined 721 oversized rooms that average approximately 500 square feet with a 75 percent suite mix. It offers seven separate food and beverage outlets, including Harriet’s Rooftop, which provides guests with exclusive views of Music City’s skyline in an elevated nightlife setting. Among other amenities, the Property has a Bamford Wellness spa with six treatment rooms, two fitness centers, a yoga studio, and 33,000 square feet of shared meeting space, including a 9,400 square foot ballroom and 9,300 square feet of pre-function space.
Supply growth is expected to continue in Nashville with most projects in the planning stages and in the select service chain scale.
