Bethesda, Maryland, October 8th / PRNewswire / -- DiamondRock Hospitality Company (hereinafter referred to as the "Company") announced today that it has acquired the permanent property rights to a luxury resort with 79 guest rooms located in Rehoboth Beach, Delaware, The Bellmoor Inn & Spa (hereinafter referred to as the "Hotel" or " The Bellmoor"), for a total transaction value of $31 million, which is approximately $392,000 per guest room.
The acquisition was paid for with cash on hand. The company stated that this represents an attractive opportunity to acquire an independent resort in a market with limited supply, strong existing cash flow, and significant room for operational improvement.
Based on the performance of the past twelve months up to August 2026, the acquisition price is equivalent to 10.4 times the hotel's EBITDA, as well as a capitalization rate of 8.6% of the hotel's net operating income (NOI). Once the company's asset management measures are implemented and the planned capital improvements during the off-season are completed, the hotel is expected to achieve a stabilized NOI yield of around 9.5%. The company expects that this acquisition will not have a significant impact on its earnings for the fourth quarter of 2026.
DiamondRock Hospitality Company CEO Jeffrey J. Donnelly states: "The acquisition of The Bellmoor reflects our ability to identify attractive investment opportunities through long-term relationships. Delaware South is one of the most attractive leisure hospitality markets on the East Coast, attracting wealthy repeat customers from the Northeast Corridor and benefiting from significant barriers to new entrants in the hospitality supply. Combining our attractive acquisition base with our proven asset management platform, we believe that these solid fundamentals will result in considerable free cash flow growth for The Bellmoor and bring long-term value to shareholders."
About the Company
DiamondRock Hospitality Company (Nasdaq ticker: DRH) is a self-managed real estate investment trust that owns a portfolio of hotel assets with diverse geographical distribution, primarily located in leisure destinations and premier gateway markets. The company currently operates 35 high-quality hotels and resorts, totaling 9,479 rooms. Strategically, the company positions its asset portfolio to be managed either by leading global brand systems or by independent boutique hotels targeting niche lifestyle markets. For more information, please visit the DiamondRock Hospitality Company website www.drhc.com.
This press release contains forward-looking statements as defined by federal securities laws and regulations. These forward-looking statements are identified by words such as “believes,” “expects,” “intends,” “anticipates,” “projects,” “plans,” and other similar expressions, and include references to assumptions and forecasts of future results. Forward-looking statements do not guarantee future performance and involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ significantly from those anticipated at the time such forward-looking statements were made.
These risks include, but are not limited to, those described from time to time in the documents submitted by the company to the U.S. Securities and Exchange Commission (SEC), including the 10-K annual report submitted on February 27, 2026, as well as the 10-Q quarterly reports submitted on April 30, 2026, and July 30, 2026. Although the company believes that the expectations reflected in the aforementioned forward-looking statements are based on reasonable assumptions, the company cannot guarantee that these expectations will necessarily be realized, or that any deviations will not be material. As of the date of issuance, the company assumes no obligation to update any forward-looking statements to make them consistent with actual results or changes in the company's expectations.
Hotel net income and adjustments for hotel EBITDA and hotel NOI
The following table shows the net profit of Hotel GAAP compared to that of Hotels EBITDA and NOI. Hotel NOI refers to the value obtained by deducting a capital reserve equivalent to 4% of the hotel's revenue from the figures of Hotel EBITDA (unit: million US dollars).
Hotels EBITDA and Hotels NOI fall under the non-GAAP financial indicators defined by the rules of the U.S. Securities and Exchange Commission (SEC). The presentation of Hotels EBITDA and Hotels NOI by the company should not be regarded as a substitute for the GAAP net profit metric, nor should it be used as the sole basis for measuring the financial performance of the hotels. The reason the company discloses these indicators is that it believes they are helpful for investors and analysts to understand the operational performance at the hotel level.
