Owners of the Historic Cavalier Hotel at the Oceanfront may sell the resort complex.
The development team approached the city and the Virginia Beach Development Authority, seeking to assign interest in an agreement to Wheelock Street Capital LLC, according to a resolution approved Tuesday by the authority.
Vice Mayor Rosemary Wilson told WHRO the possibility of a sale came as a surprise.
She said the request for action by VBDA and the city essentially is an administrative change that does not result in additional public spending.
City Council may vote on the change next week.
Wilson said it was wonderful that the Cavalier was saved and has been a success. Noting that a sale isn’t final, she said, “We just hope the new owners love it and care for it and give it the attention it needs and deserves.”
Gold Key PHR, which manages the complex, did not respond to requests for comment and Wheelock Street could not immediately be reached. WAVY-TV, which first reported the possible sale, said Bruce Thompson of Gold Key PHR told the station he couldn’t comment.
In 2023, Thompson said the $440 million redevelopment of the resort complex, which includes the hotels and amenities, was nearly done.
A potential sale would include the Historic Cavalier, the Oceanfront Marriott and the Embassy Suites, as well as the Oceanfront Beach Club and amenities, according to the resolution.
The Cavalier and the Marriott were part of a 2014 performance agreement with the city, and the development of the Embassy Suites was added in 2017, according to a presentation by Deputy City Attorney Dana Harmeyer.
In 2014, $18 million in gap financing was approved and an additional $6.5 million followed in 2017.
The development authority, in its resolution, said selling the complex would keep them operating in the city, aiding the tourism industry and the city and state economy.
A term sheet approved in 2013 said the city would assist the developer in qualifying for gap financing, assistance which is governed by state code.
The state, city and developer contribute funds equating to 1% of sales taxes generated by the project for that financing, according to the city attorney’s office.
The development authority acts as conduit.
