Willkie Advises Colony on $2.8 Billion Hotel Business Exit Deal

Willkie Farr & Gallagher represented Colony Capital in its $2.8 billion deal to sell six hospitality portfolios, including 22,676 rooms across 197 hotel properties, to Highgate, a real estate investment and hospitality-management company.

The deal comes amid unprecedented challenges for the hospitality industry, which has been heavily affected by the global coronavirus pandemic and the ensuing lockdowns.

Latham & Watkins advised Highgate on the deal, expected to close in 2021’s first quarter.

According to a statement, the transaction slashes Los Angeles-based Colony Capital’s consolidated debt outstanding by $2.7 billion. Colony Capital CEO Marc Ganzi called the sale “a significant milestone” in his company’s pivot to focus exclusively on fast-growing digital businesses that, he said, generate superior returns for its shareholders.

“We are thrilled to be delivering on our commitment to dispose of non-core assets and harvest positive value for our hospitality business. With its strong track record, unique insights into the hospitality market and creative approach to hotel management, we are confident that Highgate is ideally suited to own and operate these properties,” Ganzi said.

Highgate currently operates more than 160 hotels and approximately 45,000 rooms around the world, the statement said.