Aston Waikiki Beach
sells for $107M

The owner of the Aston hotel
group agrees to buy the 716-room
property from Leucadia of New York

The Tennessee-based owner of the local Aston hotel chain will pay $107 million to acquire the 716-room Aston Waikiki Beach Hotel.

Gaylord Entertainment Co. said yesterday it has agreed to buy the twin-tower hotel from Leucadia National Corp. of New York.

Gaylord, owner of the Grand Ole Opry in Nashville, Tenn., and the ResortQuest hotel brand, said it plans to bring in a new partner that will provide most of the financing for the purchase and will own a majority stake in the hotel.

The company said that it has begun negotiations with several parties, which it did not identify.

The hotel will continue to be managed by Gaylord under the Aston name.

"We're overjoyed to continue our management of the Aston Waikiki Beach Hotel," said Kelvin Bloom, regional vice president for ResortQuest, which operates the Aston hotels in Hawaii. "We are excited and pleased that our parent company has agreed to purchase the property."

The deal, which is subject to due diligence review and approval from Gaylord's board of directors, comes after the hotel completed a $30 million facelift in 2002.

New York-based Leucadia took over the hotel in a 2001 foreclosure auction after acquiring the mortgage on the property.

Leucadia acquired the note from Japanese lender Mitsui Trust & Banking Co., which had lent previous owner Otaka Inc. about $85 million during the 1980s Japanese investment bubble.

The hotel, on the mauka side of Kalakaua Avenue at the Diamond Head end of Waikiki, includes a 23-story Main Tower, which houses 644 rooms, and a nine-story Mauka Tower, which has 72 rooms.

It also has 19,400 square feet of retail and restaurant space, an outdoor pool and 2,900 square feet of meeting space.

Gaylord, which acquired ResortQuest in 2003, is also the owner of the Gaylord Hotel chain.

"This crown jewel hotel, located on one of the most desirable beachfronts in Hawaii, is an important asset in the current ResortQuest portfolio," said Colin Reed, Gaylord's president and chief executive.