Kona Surf Partners has acquired the Sheraton Keauhou Resort and Spa in Kailua-Kona, Big Island, Hawaii, for US$26.2m (17.7m euro, £15.9m).
The property had been foreclosed by a lender in January 2010 last year after the previous owner defaulted on a debt accrued during a US$55m (37m euro, £33m) redevelopment of the property in 2005.
New York-based Kona Surf Partners is an investment vehicle, believed to have been set up specifically for the deal by Avenue Capital Management – an adviser for hedge funds run by Marc lasry.
The 521-bedroom resort has 22 acres of oceanfront property, features a full-service spa and fitness center and more than 75,000sq ft of indoor and outdoor meeting space.
Property Specialist Jones Lang LaSalle secured the deal on behalf of the hotel's special servicer, TriMont Real Estate Advisors.
John Strauss, a managing director for Jones Lang LaSalle Hotels, said: "Despite a period of significant market decline on the Big Island, the market has begun to rebound as demand from both group and leisure travellers begin to return to the Hawaiian Islands."
The property is currently managed by Starwood under the Sheraton brand. Starwood is due to begin negotiations on a continuation of the management deal with the new owner shortly.
