In April 2021, funds managed by Fortress acquired the 486-key Frenchman’s Reef Resort in St. Thomas, US Virgin Islands. The renowned property was built in 1973 and operated until it was heavily damaged in 2017 by two hurricanes. Building upon our deep Caribbean experience from repositioning the Westin Grand Cayman, we saw great potential in Frenchman’s Reef.
We acquired the resort for just $35 million, from a prior owner undergoing corporate liquidity challenges that had already invested $157 million in renovation costs. Post-acquisition, we invested an additional $264 million to complete the comprehensive renovation, bring the hotel to Miami-Dade hurricane-resistant standards, upbrand to a Westin/Autograph Collection, and re-imagine the amenity offerings.
Even after this substantial capital investment that delivered a luxury product, our basis is a significant discount to estimated replacement cost. The resort held its grand opening in January 2024 with the Governor of the U. Virgin Islands cutting the ribbon, officially restoring an iconic property back to its place of prominence in the Caribbean.
