In a recently-amended 13D filing on Strategic Hotels & Resorts Inc. (NYSE:BEE), asset management Cascade Investment LLC, owned by William Bill Gates, disclosed a 9.8% ownership stake in the company with 26.91 million shares. This is up nearly 1.74 million shares from the 25.18 million shares held as of March 9, when the fund submitted its latest 13D filing on the equity real estate investment trust.
Cascade Investment serves as the investment arm of billionaire Bill Gates and is managed by successful value investor Michael Larson, who also administers The Bill and Melinda Gates Foundation Trust. Michael Larson is a key person behind the impressive growth of Bill Gates’ fortune, which reached a net worth of over $79 billion.
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Strategic Hotels & Resorts Inc. (NYSE:BEE) is a real estate investment trust (REIT) that owns and provides value enhancing asset management of upscale and luxury hotels and resorts in the United States and Europe. The shares of the REIT are currently trading exactly at the same level as they were trading on the first day of 2015. However, the stock has embarked on a steady uptrend a few months ago after suffering a significant slump during the first months of the year, gaining nearly 10% over the last two-month period. From a pool of over 700 hedge funds that we track, Jim Simons’ Renaissance Technologies represents the largest shareholder of Strategic Hotels & Resorts Inc. (NYSE:BEE), holding an ownership stake of 1.49 million shares as of March 31.
There have been rumors circulating that Strategic Hotels & Resorts is exploring a sale and actually hired a bank to assist the company in finding a potential buyer. On the back of the news, Cascade announced that it might be interested in participating as a buyer in a potential transaction. However, the officials at Strategic didn’t announce or comment a potential buyout, claiming that the company doesn’t comment on market rumors. Last year, the investor bought Four Seasons Punta Mita from the company for $200 million.
Reportedly, the company might serve as an attractive acquisition at the moment as the demand for upscale accommodation increases amid corporate travel rebound. Specifically, Hendersonville, a Tennessee-based research firm, has recently estimated that the occupancy rate at luxury properties reached 70.9% in the first six months. Ian Weissman, an analyst at Credit Suisse, placed a $16.50 per share price tag for the company under a takeout scenario.
Leaving the rumors aside, Strategic Hotels & Resorts has recently announced the acquisition of the remaining 49% ownership interest in the New York-located JW Marriott Essex House hotel, which is anticipated to generate an incremental $5.5 million of EBITDA over the remaining five-month period of the current year.
Just a few days ago, Strategic Hotels & Resorts disclosed its financial results for the second quarter of this year, which included revenue of $356.9 million, up by 29.2% year-over-year. Meanwhile, its net income declined to $6.7 million or $0.02 per diluted share, compared to $80.8 million or $0.35 per share reported for the same quarter a year ago, which included a one-time gain from the acquisition of Hotel del Coronado.
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