To whom did Caption By Hyatt sell Hyatt Regency Orlando?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
lion pre-tax loss, which was recognized in gains (losses) on sales of real estate and other on our consolidated statements of income during the year ended December 31, 2024. The operating results and financial position of this hotel prior to the sale remain within our owned and leased segment.
Hyatt Regency Orlando—During the year ended December 31, 2024, we sold Hyatt Regency Orlando and an adjacent undeveloped land parcel to an unrelated third party. We received $723 million of cash consideration, net of cash disposed, closing costs, and proration adjustments, and accounted for the transaction as an asset disposition.
In conjunction with the sale, we received a $265 million preferred equity investment in the parent of the third-party entity that owns the property. Upon sale, we estimated the fair value of our preferred equity investment, which is redeemable at our option on various dates starting in 2030, to be approximately $188 million and recorded a HTM debt security within other assets on our consolidated balance sheet (see Note 4). The fair value was estimated using a probability-based discounted future cash flow model and includes assumptions and judgments regarding the probability weighting, discount rates, and expected timing of payments, which are primarily Level Three assumptions.
Additionally, we provided $50 million of seller financing with an initial maturity date of five years for the adjacent undeveloped land parcel. Upon sale, we estimated the fair value of the seller financing to be approximately $34 million and recorded an unsecured financing receivable on our consolidated balance sheet (see Note 6). The fair value was estimated using a discounted future cash flow model and includes assumptions and judgments regarding the discount rate and expected timing of payments, which are primarily Level Three assumptions.
Upon sale, we entered into a long-term management agreement for the property and a development agreement for the adjacent undeveloped land parcel. The sale resulted in a $514 mi
Source: Item 21 — Financial Statements (FDD pages 84–85)
What This Means (2025 FDD)
According to Caption By Hyatt's 2025 Franchise Disclosure Document, during the year ended December 31, 2024, Hyatt sold the Hyatt Regency Orlando and an adjacent undeveloped land parcel to an unrelated third party. Caption By Hyatt received $723 million in cash consideration from this sale, after accounting for cash disposed, closing costs, and proration adjustments. The transaction was classified as an asset disposition.
In addition to the cash consideration, Caption By Hyatt received a $265 million preferred equity investment in the parent company of the third-party entity that now owns the property. Upon the sale, the fair value of this preferred equity investment, which becomes redeemable at Caption By Hyatt's discretion starting in 2030, was estimated to be approximately $188 million. This amount was recorded as a HTM debt security within other assets on Caption By Hyatt's consolidated balance sheet.
Caption By Hyatt also provided $50 million in seller financing for the adjacent undeveloped land parcel, with an initial maturity date of five years. The fair value of this seller financing was estimated to be approximately $34 million upon the sale, and it was recorded as an unsecured financing receivable on Caption By Hyatt's consolidated balance sheet. Upon the sale, Caption By Hyatt entered into a long-term management agreement for the property and a development agreement for the adjacent undeveloped land parcel. The sale resulted in a $514 million pre-tax gain, which was recognized in gains (losses) on sales of real estate and other on Caption By Hyatt's consolidated statements of income during the year ended December 31, 2024.