ACQUISITION & MANAGEMENT
BEACH RETREAT RESORT
Lake Tahoe, CA
The Beach Retreat & Lodge at Tahoe (“BRL”) is a 262-key resort encompassing five buildings and situated on nearly seven acres with nearly 500 feet of frontage along the shores of Lake Tahoe in South Lake Tahoe, CA, just two-miles west of the Nevada border. Given entitlement challenges including oversight by the Tahoe Regional Planning Authority, a joint California / Nevada governing body, the site’s size and location is unsurpassed replicating this type of property (through an assemblage) would be nearly impossible.
The resort has numerous amenities: a one-of-its kind (on Lake Tahoe) 1,000 foot pier, 80 moorings, a 1,600 square foot restaurant (the Boathouse) located on the pier, a heated outdoor pool, a 24-hour fitness center, an outdoor firepit, onsite laundry, and a lobby with a fireplace as well as additional restaurant and bar. Although constructed during Urbana’s ownership as described below, the property also consists of a stand-alone 3,100 square foot conference center to supplement the indoor meeting space. Through a lease with a marina operator, guests have access to rent boat, jet ski, and kayak rentals.
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Three-story, 262-key lakefront hotel
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500 feet of beach frontage
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1,000 foot pier
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4,000 sq. ft. resort in South Lake Tahoe[AC1]
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Land area of nearly seven acres
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Built in 1974
BACKGROUND
Urbana acquired a distressed resort inherited by the sons of a local real estate patriarch with no hotel or resort operational experience for $14.2 million in 2012. At the time, the resort was generating only $270,000 of NOI. The property was branded as a Best Western yet was situated on a prime 7.6-acre development site. Lake Tahoe is one of the most picturesque lakes in the United State, with Safire blue water surrounded by mountains, yet it offers few beaches around its perimeter.
This site was on the waterfront and had a large beach along with a 1,000-foot pier with frontage along Highway 50. With an exceptionally rare combination of attributes, the property was a prime candidate for redevelopment. Urbana prudently managed the amount of capital invested to enhance the NOI, expecting the escalation in land value may mirror the income-producing potential of the current improvements. The Best Western flag was creating an ADR ceiling and attracting a highly rate-conscious guest.
To enhance value, Urbana devised a property turnaround plan, which included rebranding the property to the Beach Retreat & Lodge, implementing standard operating procedures, hiring competent personnel, and undertaking a high guest impact property improvement program.
Additional conference space was constructed to build a revenue base of group guest business in what had previously been solely a transient guest business. While a redevelopment plan was created, Urbana’s capital partners chose to sell the property rather than embark into the world of development. With the NOI improving to $2,100,000 prior to 2019, the property was sold for $31,255,000 the first quarter of 2019.