Blackstone Real Estate Partners IX, to Acquire a 65% Controlling Interest in Great Wolf Resorts

Main Photo: The Great Wolf Lodge, Fitchburg, Mass. USA

Date: October 2019

Location: 18 resorts across the USA

Name: Great Wolf Lodge

No. of Keys: 7,230

Seller: Centrebridge Partners….as part of the transaction, Blackstone and Centerbridge Partners will form a new US$2.9 billion joint venture to own the company.

Centrebridge acquired Great Wolf in 2015 from Apollo Global Management for $1.35bn (10 times EBITDA). Apollo took the company private in 2012 for $703m.

Buyer: “We have been very impressed by the evolution and growth of the company under Centerbridge’s ownership,” Tyler Henritze, head of U.S. acquisitions for Blackstone Real Estate, said in a statement. “With the leadership of its talented management team, Great Wolf has enriched the guest experience and opened seven new lodges since 2015. We look forward to investing in these properties to further deliver for guests and grow the company.”

Great Wolf has 18 resorts with 7,230 guestrooms across the United States and Canada, as well as another under construction in northern California. Each location includes a full-service hotel, an indoor waterpark, food-and-beverage offerings and recreational activities such as game rooms, ropes courses and bowling alleys. It employs approximately 6,000 people full-time.

“We are pleased to welcome Blackstone as a new member of the Great Wolf pack and excited to begin the next chapter for our rapidly expanding company,” Murray Hennessy, CEO of Great Wolf Resorts, said in a statement. “Great Wolf stands to benefit greatly from Blackstone’s world-class insights and expertise in hospitality, and values Centerbridge’s continued involvement as we look to further expand the Great Wolf brand with the development of new resorts and enhancements to our renowned immersive family experiences.”

Centerbridge Partners is a private investment management firm that partners with management teams across industry sectors. Founded in 2005, it had approximately $27 billion in capital under management as of June 30.

“We are enthusiastic about partnering with Blackstone to continue accelerating the growth of the company,” William Rahm, a senior managing director and global head of real estate at Centerbridge, said in a statement. “Blackstone is one of the most experienced and successful investors in the hospitality and leisure industries and is highly supportive of Great Wolf’s growth potential and each lodge’s ability to provide unparalleled experiences for families.”

Goldman Sachs & Co. and Citigroup Global Markets are serving as financial advisors to Great Wolf, and Simpson Thacher & Bartlett is serving as legal counsel to Great Wolf. Fried, Frank, Harris, Shriver & Jacobson is serving as legal counsel to Blackstone.

Price: New JV valued at US$2.9bn thus 65% investment is around US$1.85bn

Price per Key: at $2.9bn …US$401,106

THPT Comment: Blackstone, founded in 1991, has US$154 billion of investor capital under management. Just a few weeks ago, Blackstone Real Estate Partners Europe reached an agreement to acquire five Greek hotels from the Mediterranean company Louis Group for €178.6 million—US$195.5 million. In July, Blackstone bought three Florida hotels from an affiliate of RLJ Lodging Trust for $43.2 million. Around that same time, the company was also in talks to sell seven Center Parcs Europe vacation resorts to Aroundtown SA for an estimated $1.1 billion. Much in and out for Blackstone into hotels, given their involvement in say Hilton, from taking it private in 2007 at $26bn, to selling it’s final tranche of shares in May 2018 for $1.3bn. Big numbers!

First Seen: Hotel Management

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