DiamondRock Sells Manhattan Courtyard Asset for $33M, Cuts 2026 EBITDA Guidance
DiamondRock sold its leasehold interest in the 189-room Courtyard by Marriott New York Manhattan/Fifth Avenue for $33.0 million, representing a 6.3× multiple on 2025 Adjusted EBITDA and a 13.3% cap rate. The transaction prompted a $5.9 million cut to 2026 Adjusted EBITDA guidance to $290.2–302.2 million and a $0.025 per-share FFO reduction.
1. Asset Sale Details
DiamondRock sold its leasehold interest in the 189-room Courtyard by Marriott New York Manhattan/Fifth Avenue for $33.0 million, equating to a 6.3× multiple on 2025 Hotel Adjusted EBITDA and a 13.3% cap rate on 2025 Hotel Net Operating Income. It expects a stabilized cap rate of roughly 7.8% after $12 million in required capex, rising ground lease payments and labor cost pressures, or 6.5% on a fee simple basis.
2. Guidance Revision Impact
The company lowered its full-year 2026 guidance to reflect a $5.9 million reduction in the low end of Adjusted EBITDA guidance (now $290.2–302.2 million) and a $5.1 million reduction in Adjusted FFO guidance (now $228.4–240.4 million), trimming per-share FFO forecasts by $0.025 to $1.10–1.16.
3. Asset Performance and Strategy
The hotel’s Net Operating Income more than doubled from 2019 to 2025, driven by active asset management and operating partnerships. DiamondRock cited upcoming capital expenditure demands and structural expense headwinds as failing to meet its investment thresholds, reinforcing its strategy of disciplined capital allocation and free cash flow growth.