🚨Columbia Sussex has acquired the 744-room Hilton Daytona Beach, the county’s largest hotel, with plans for a “massive” renovation while keeping the Hilton flag. The transaction follows a 2025 performance dip, with July occupancy at 64.7% (–5.8% YoY) and RevPAR at $93.49 (–3.7% YoY), lagging state and national averages. For CRE investors, this signals continued appetite for value-add beachfront resorts where capital improvements can reset ADR and group demand. Debt markets will demand conservative underwriting given secondary-market volatility and ongoing high rates.
Daytona Beach July 2025 Occupancy: 64.7% (–5.8% YoY)
Daytona Beach July 2025 RevPAR: $93.49 (–3.7% YoY)
Florida Statewide July 2025 Occupancy: 67.3% (–1.2% YoY)
U.S. July 2025 RevPAR: $110.37 (–1.1% YoY)
Loan Performance. Anticipate higher debt service pressure during renovation, with interest rates still ~7–8% and likely 10–20% rooms offline. DSCR will be tight; reserves essential.
Demand Dynamics. Daytona underperforms Florida, but renovation plus Hilton’s loyalty engine could capture higher-rated group and leisure share. Seasonal volatility (Daytona 500, Bike Week) must be built into cash-flow models.
Asset Strategies. Phased renovation mitigates downtime risk. CapEx likely $30–40M+; strict sequencing and Hilton PIP compliance required. ROI hinges on ADR uplift of 10–15% max.
Capital Markets. Financing selective: expect 50–60% LTV, spreads +300–400 bps over SOFR. Exit cap rate guardrails: ~8%+ given secondary market and leisure risk.
Florida resort valuations remain resilient, but underwriting must price in near-term softness.
Upside depends on ADR gains post-reno, not occupancy spike.
Financing achievable with strong equity but priced for risk.
Renovation execution is the real driver of success.
🛠 Operator’s Lens
Refi. Bridge-to-perm likely; interest reserves essential until stabilization.
Value-Add. Renovation must address core pain points (HVAC, F&B, spa) to justify rate lift.
Development. Pro forma stress test off-season months; ensure coverage at 60–65% occ.
Lender POV. Banks and debt funds will scrutinize CapEx plan and Hilton brand compliance before extending credit.
Short-term: Occupancy volatility during phased renovation.
Medium-term: By 2026, repositioned Hilton could lead Daytona with ADR recovery and ~70%+ occupancy.
Risk: Renovation overruns, weak off-season demand, and rising insurance costs in coastal Florida.
News-Journal Online — Starwood paid $92.3M for Hilton Daytona (2015). Meeting Today — Hilton Daytona 2019 $25M renovation. New Jersey Travel Hub — Columbia Sussex plans “massive renovation” (2025). STR / Daytona CVB — July 2025 Occupancy & RevPAR. Yahoo — Florida statewide hotel performance (July 2025). HospitalityNet — U.S. hotel RevPAR (July 2025).
