In fall 2009, the media all but declared a deathwatch on Sam Nazarian's SLS at Beverly Hills. Today comes the news that Colony Capital LLC, the Santa Monica-based private-equity firm whose assets include Michael Jackson's Neverland, has taken a minority stake in Nazarian's SBE company, according to the Wall Street Journal. By investing $35 million in SBE, Colony, which manages a tidy portfolio of $30 billion, Colony plans to expand its presence in the boutique-hotel market, chairman Thomas J. Barrack Jr. tells the paper. (More proof that hotels are where the money is going?) And if everyone from Richard Branson to Ian Schrager have announced plans for new boutique hotels, "Colony's bet is that Mr. Nazarian can do a better job drawing the young, upscale crowds. 'It's a bet on the jockey,' Mr. Barrack said. 'People want to stay at somebody's property and share in their expertise, hospitality and vision.'" As for Nazarian's existing brands, occupancy at the new Hollywood Redbury is expected to be more than 75 percent in the first quarter, Nazarian tells Bloomberg. And while Nazarian tells the WSJ he is close to restructuring the mortgage on the long-stalled Sahara project in Vegas, Hotel Chatter is hoping for some sign of life at SLS South Beach in Florida.
· Colony Gets Boutique-Hotel Partner [WSJ]
· Barrack's Colony Capital Invests $35 Million in Hotelier, Club Owner SBE [Bloomberg]