VIRGINIA BEACH, Va. — The owners of the Historic Cavalier Hotel in Virginia Beach are looking to sell the property, along with two other Oceanfront hotels, in a resolution that was brought to the city's development authority on Tuesday.
In addition to the Cavalier, the Oceanfront Marriott and the Embassy Suites may also be sold to Wheelock Street Capital LLC, a Connecticut-based real estate investment firm. The resolution aims to transfer the current gap financing that was approved for these properties to their prospective buyer.
The authority approved the resolution during its meeting.
In 2014, the Virginia Beach City Council and the Virginia Beach Development Authority approved $18 million in gap financing for the Cavalier project, the initiative to restore the historic Cavalier hotel properties. In 2017, $6.5 million in gap financing was added for the Embassy Suites.
The Cavalier Hotel first opened back in 1927, serving as a landmark of the Virginia Beach Oceanfront. The hotel was closed for a time, then it reopened in 2018 after a push from city leaders to restore the historic property.
In a report submitted by Gold Key PHR — the resort's developer — to the Virginia Beach City Council back in 2023, the following details were shared:
- The hotel renovation took five years to complete and cost $85 million, which was $35 million over budget.
- After the renovation efforts were completed, the Historic Cavalier Hotel reopened, 81 Cavalier residences were sold, the Marriott Virginia Beach Oceanfront opened, all 35 units of the 42 Ocean luxury condos were sold, and Embassy Suites by Hilton Virginia Beach Oceanfront opened.
- The city’s $18 million investment was recovered by 2021 “in new ‘but-for’ taxes.”
In 2023, the Historic Cavalier Hotel and its two sister hotels were projected to generate $9,520,360 in city tax revenue, according to Gold Key PHR’s report.
News 3 reached out to the current owner of the Cavalier and the potential buyers, but has yet to hear back.
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