Hammock Beach Resort Turnaround Case Study

In 2011, Salamander Hotels & Resorts was selected by Lubert-Adler, a real estate investment company, to manage Hammock Beach Resort in Palm Coast, Florida.

A large-scale property located on over two miles of Atlantic beachfront with an active membership base, Hammock Beach Resort features over 300 accommodations, including a 12-story tower of luxury suites and a 20-room Lodge. It also includes a 206-slip marina, multiple restaurants and bars, a full-service spa, a tennis facility along the Intracoastal Waterway, a multilevel water pavilion, numerous pools, and thousands of square feet of meeting space. Additionally, the resort is famed for its two spectacular golf courses: the Ocean Course designed by Jack Nicklaus and the Conservatory Course designed by Tom Watson.

Upon engagement, Salamander’s primary focus was to stabilize financial performance and stop the negative flow at EBITDA. The company was also charged with enhancing service quality experiences for club members and resort guests.

Throughout eight years of management, Salamander successfully led a total revenue increase of 63%. Additionally, Salamander stabilized club membership participation and increased revenue by 32%. The company was able to reposition the property, which was in a position of zero market value (a liability with negative EBITDA), into a valuable asset by increasing EBITDA by $9.5 million.

The positive financial performance of the resort enabled ownership to invest in improvements at the property, which Salamander oversaw. This included a complete renovation of the Ocean Course after the impact of Hurricane Matthew in 2016 and 2017. In addition, the resort’s lobby, Ocean and Atlantic ballrooms, and its Lodge were also renovated.

As Salamander’s leadership of the resort improved financial performance, resources were also re-invested in more competitive wages and benefits for the resort’s service professionals, boosting morale and performance.

Because of the significant financial turnaround of Hammock Beach Resort, the ownership group tasked Salamander with the development of a new 198-room oceanfront hotel to enhance the value of the existing resort lodging and amenities. After an extensive process that involved working closely with county government, the club membership, neighbors and community leaders, Salamander was able to obtain approvals for the project, conceptually design the new hotel and execute a feasibility study.

By December 2019, Hammock Beach Resort was both appropriately stabilized and successfully positioned for the future, and Lubert-Adler was able to execute its long-term strategy of selling the asset.

SALAMANDER RESORT & SPA
Development CASE STUDY

Middleburg, Virginia

In 2002, Sheila Johnson acquired a 340-acre parcel of land in Loudoun County, Virginia which was zoned “Agriculture” with limited rights to the development of 49 houses.  Led by its President, Prem Devadas, Salamander initiated a process in 2005 to develop a 168-room luxury resort. Working with Loudoun County and the Town of Middleburg, Salamander negotiated a highly contested three-party Memorandum of Understanding, which was ultimately approved by Middleburg’s Town Council and the County Board of Supervisors in 2007.  In addition to gaining the resort approval, Salamander also negotiated the approval of an additional 60 residences and 30,000-sf of commercial development on the 340-acre parcel.

The Salamander team managed all aspects of the resort development including the selection of the design team led by architectural firms WATG and Architecture, Inc., and a collaboration of interior designers Thomas Pheasant, Forrest Perkins and Kent Interiors.  Salamander engaged MGAC for project construction management services and selected Turner Construction as a general contractor.  Construction began in the Fall of 2007, including the development and construction of new water treatment and waste water treatment plants for the Town of Middleburg.

Faced with severe economic headwinds beginning in the latter half of 2008, Salamander made the decision to halt construction in 2009 after completing the exterior skin of the main building and major mechanical systems, rather than opening the resort during the recession.  In early 2012, after developing a detailed plan for re-engagement with Turner Construction and numerous subcontractors, Salamander resumed construction of the resort.

Salamander Resort & Spa opened in August, 2013 on time and on budget and to national recognition and accolades.  In 2018, the Resort was recognized by Forbes Travel on its list of World’s Most Luxurious Hotels & Spas, one of only three properties in the U.S. to receive recognition for both lodging and spa.  And in 2019, the Resort received the coveted Five-Star rating from Forbes Travel, one of only two new U.S. recipients of the award that year. In 2020, they were named once again the only Forbes Five-Star resort in the greater Washington, D.C. area.

The Salamander corporate team managed all aspects of the entitlement, design, development, construction, accounting, preopening operations services, and the sales and marketing launch.  It is worth noting that during the entirety of the development process, the Salamander team also managed other significant resort projects, including the $25 million renovation of Innisbrook Resort and the takeover and repositioning of two major Florida golf resort assets for Lubert Adler, Reunion Resort in Orlando and Hammock Beach Resort in Palm Coast.  This demonstrates the depth of Salamander’s corporate team and our capability to manage multiple complex projects simultaneously.