Hotel investor and developer Eagle Four Partners has viewed the past two years as an opportunity—for new aquisitions, projects and upgrades—unlike many hospitality firms.
Since the onset of the pandemic, the Newport Beach-based firm has invested significantly in its hotel portfolio by upgrading its hotels in and out of Orange County.
It also added to its local holdings, paying $360 million for two of the most prominent hotels in Newport Beach. The company has committed spending north of $150 million to convert those two local properties into high-end offerings—to better meet the new wave of luxury demand from locals and visitors.
This includes an $80 million renovation to convert the Newport Beach Marriott Hotel & Spa into the Vea Newport Beach Hotel, and a $70 million renovation to transform the Fashion Island Hotel into the Pendry Newport Beach, which will debut next summer as a boutique-style luxury hotel complete with fine dining and a membership social club.
“We believe we are at the forefront of creating new hospitality experiences for both locals and visitors to Orange County,” Kory Kramer, one of five partners at Eagle Four, told the Business Journal.
The company today counts north of 2,000 employees across its portfolio, which includes 13 properties topping 3,700 rooms, in California, Colorado, Nevada, Louisiana, Arizona and Hawaii.
Bullish on NB
Yet to come is perhaps the company’s most luxe Newport Beach addition to date: a Ritz-Carlton Residences tower adjacent to the Vea hotel, built in partnership with Lyon Living, the Newport Beach apartment investor and developer founded by the late Gen. William Lyon.
Eagle Four, whose partners include Kramer, Kevin Martin, Todd Pickup, Joe Moody and Rick Weiner, now has five properties in Newport Beach: Vea; the soon-to-open Pendry Newport Beach; The Newport Beach Country Club; the Balboa Bay Resort; and Balboa Bay Club.
Eagle Four has invested more than $1 billion in the city through those properties, the company told the Business Journal.
The company, whose partners were selected as one of the Business Journal’s Businessespeople of the Year for the tourism and hospitality sector, isn’t just active in its home city, with upgrades in store for its Huntington Beach property and early success seen in Denver following the firm’s $80 million renovation of the Sheraton Denver Downtown Hotel.
Still, Newport Beach remains center stage for the company in 2023.
“We are very bullish on Orange County and Newport Beach,” Kramer said. “We live, work and play here, and we’re grateful to be able to create beautiful projects in our hometown for our neighbors to enjoy.”
Join the Club
Last year was one of execution for Eagle Four, both for new deals and following through on plans it set in place in 2020.
In February, the company spent nearly $144 million to acquire the 295-room Fashion Island Hotel from The Irvine Co. The sale was the second priciest hotel deal of the year in the state.
Eagle Four told the Business Journal it is investing upwards of $70 million to transform the hotel—which shuttered in 2020 as a result of the pandemic—into the third Southern California property of Pendry Hotels & Resorts, a growing luxury boutique hotel line from Irvine-based Montage International, following spots in West Hollywood and San Diego.
“The property is a unique venue that you won’t find elsewhere in Orange County,” Martin said. “A premier restauranteur is part of the renovation as well as innovative upgrades to make this a luxury destination unlike any other.”
The renovation of the 20-story property, which will maintain its room count of 295, will include an exclusive social club component, marking Eagle Four’s third membership-based club in Orange County, joining the Newport Beach Country Club and Balboa Bay Club.
“We will have three of the most successful clubs in OC under our portfolio, and we have some ideas of how to integrate all three with new experiences for members, such as off-site trips or boating excursions,” Martin said.
Pendry Newport Beach is expected to open this summer.
It will join the nearby Vea Newport Beach, a Marriott Resort & Spa, which Eagle Four opened in June following an $80 million renovation.
A venture led by Eagle Four acquired the 532-room Newport Beach Marriott Hotel & Spa in 2020 for $216 million and spent the following two years upgrading the hotel with new coastal-inspired guest rooms with two suite categories, three restaurant and bar concepts, a spa and fitness center, several indoor and outdoor event spaces, and a resort-style pool.
One of Eagle Four’s partners in the deal, Newport Beach’s Lyon Living, is spearheading a 22-story Ritz-Carlton condominium tower that will go up on a portion of the hotel site.
There are 400 guest rooms at Vea, with 132 rooms making way for the planned residences.
Demolition work has already begun on the portion of the site that will ultimately hold the luxury tower, called the Ritz-Carlton Residences, and the venture is now working through the construction design phase after winning full approvals last May.
Vertical construction will begin later this year.
“The community really rallied around this project,” Kramer said. “There’s huge interest among locals for this type of a residential offering, which will feature high-end homes with all the amazing amenities of a resort.”
Prices for the for-sale residences have yet to be disclosed.
The hotel and condominium complex is situated on a 10-acre parcel about a mile from the entrance to the Newport Beach Country Club, and overlooks the golf course.
“There’s a new wave of luxury in Newport Beach, and we believe we are at the forefront of that wave,” Kramer said.
Surf City, Denver
Outside of Newport Beach, Eagle Four this year will begin a repositioning of the food and beverage offerings at the 250-room Paséa Hotel & Spa in Huntington Beach, OC’s 52nd largest hotel by room count last year.
“Our restaurant and rooftop bar have been successful concepts at the hotel in recent years, and we feel the need to invest in them to elevate them even more, and keep them on the cutting edge,” Kramer said.
The upgrades follow a renovation of the hotel’s pool deck last summer.
“Food and beverage has become critical for a hotel’s success,” Kramer said.
In Denver, Eagle Four in 2018 purchased the largest hotel in the city: the 1,231-room Sheraton Denver Downtown, which was appraised at $415 million.
Eagle Four wrapped an extensive $80 million renovation on the hotel in 2020, which appears to have paid off in the wake of the pandemic.
“Last year was the best year on record for the hotel, and we’re gearing up for an even better one this year,” thanks in part to a swift return of group business, Martin said.
Next Two Years
Finding and retaining a talented staff remains a top challenge for the company.
Despite other industry headwinds—tricky debt markets and shaky consumer confidence, for example—Eagle Four has an optimistic outlook for the next two years.
“The quality and location of our hotels is a key part of that,” Kramer said. “Capital markets have made it difficult to get construction financing, so having hotels here and projects in place has protected us.”
He pointed to last year’s blockbuster $650 million sale of the Montage Laguna Beach as a sign of strong demand for high-end, well-located hospitality assets.
“There’s more demand than supply for these types of properties, and we will continue to see deals like this in coastal Orange County,” Kramer said.
That’s not to say Eagle Four isn’t keeping its eyes open for new opportunities.
“We are constantly looking at new projects and new ideas,” Martin said.
But for the most part, 2023 will be about “finishing what we’ve started.”