Eagle Four Partners scored a $146 million loan for its plan to convert the shuttered Fashion Island Hotel into Pendry Newport Beach.
ACORE Capital provided the five-year, first mortgage loan to the Newport Beach-based firm, which used the financing to buy the property, with any remaining proceeds to be used for renovations, ACORE announced on Thursday. Eastdil Secured arranged the financing.
Eagle Four Partners purchased the leasehold interest in the property for around $143 million, according to lease documents filed with Orange County.
Formerly known as the Fashion Island Hotel, the property at 690 Newport Center Drive was previously owned by the Irvine Company. The commercial firm closed the hotel in the spring of 2020, due to the coronavirus pandemic, and will retain ownership of the land the establishment occupies.
In connection with its purchase, Eagle Four Partners entered into an agreement with Irvine-based Montage International earlier this year to reopen the property under Montage’s Pendry Hotels & Resorts brand. Launched in 2017, there are now nine Pendry hotels across the country, including in West Hollywood and New York.
Hotel sales in Orange County soared in 2021 with 48 hotels trading hands, compared to 19 hotels in 2020, when the pandemic initially halted transactions, according to hotel brokerage firm Atlas Hospitality Group.
Eagle Four’s acquisition already beats out the most expensive deal of 2021 – Dynamic City Capital’s $65 million purchase of the 174-room Element Hotel in Anaheim.
Eagle Four is no stranger to hotel ownership. The private equity firm also owns the 532-room Newport Beach Marriott Hotel near Fashion Island, which it plans to reopen under Marriott’s VEA brand this year.
The firms also own the Balboa Bay Club, which includes hotel operations, along with establishments in Irvine, Napa Valley, Santa Ana, Denver, Tempe and New Orleans.