- Blum Capital and Fairmont bought an 88% controlling stake in The Grand Del Mar for about $228M in March 2015.
- Fairmont will manage and rebrand the property as the Fairmont Grand Del Mar under a long-term agreement.
- The luxury resort features 249 rooms, eight villas, a 21,000-sq-ft spa, a Tom Fazio golf course, and major dining and meeting space.
- Manchester Financial Group kept a minority stake and existing restaurant operations and staff were expected to remain unchanged.
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Date and Deal Structure: On March 30–31, 2015, Blum Capital Partners, along with Fairmont Hotels & Resorts (through parent FRHI) acquired an 88% majority stake in The Grand Del Mar hotel for roughly $228 million; Manchester Financial Group retained the remaining interest.
Rebranding & Management Arrangement: Following the acquisition, Fairmont was slated to assume management and rebrand the property as Fairmont Grand Del Mar, under a long-term agreement. This was a standard private equity + operator model: investment by PE (Blum), branding and management by a competent luxury hotel operator (Fairmont), with founder retaining minority ownership. Manchester Financial Group’s continuation as minority owner helped smooth continuity.
Resort’s Key Physical and Amenity Attributes: The Grand Del Mar consists of 249 guest rooms and suites, eight two-story 4,500 sq ft villas, a 21,000-sq ft spa, an 18-hole Gary Tom Fazio designed golf course, six food & beverage outlets including the signature restaurant Addison, boutique shopping, state-of-the-art fitness center, and over 27,000 sq ft of meeting/event space with a 10,000 sq ft ballroom.
Strategic Rationale & Implications: For Blum Capital, this acquisition signified a move into high-end hospitality with an already well-established luxury property, minimizing risks associated with greenfield developments. Fairmont boosted its presence in the Southern California ultra-luxury segment. Maintaining chef, restaurant concepts, and overall design signaled a strategy of preserving high quality and brand reputation rather than wholesale repositioning.
Open Questions: Some remaining uncertainties include how performance metrics (ARR, occupancy, spa revenue) evolved post-acquisition; extent of additional capital expenditure beyond rebranding and minor refurbishments; and how competitive pressures in luxury Southern California lodging with newer resorts affected the asset. Also, impact of rising operating costs and labor on margins in high end hospitality remains relevant.
Supporting Notes
- Blum Capital paid approximately $228 million to acquire the majority stake in Grand Del Mar, with Fairmont Hotels & Resorts tapped to take over management and rebrand the property.
- The resort comprises 249 rooms, eight two-story villas, a spa of 21,000 square feet, an 18-hole Tom Fazio golf course, six food & beverage venues, boutique shops, a fitness center, and 27,000 sq ft of meeting space including a 10,000 sq ft ballroom.
- Manchester Financial Group retains a minority interest after the acquisition; Fairmont (via FRHI) also holds a minority interest under the deal structure.
- The resort had received high recognition prior to the deal: named TripAdvisor’s #1 Luxury Hotel in California in 2014 and earned Forbes Travel Guide’s Five-Star rating for multiple years.
- Under the post-deal arrangement, the existing signature restaurant(s), including Addison, and staff were maintained; no planned changes to restaurant concepts were announced.