Courtesy / Diane Pace
In her purchase of the Lighthouse Inn, in York Beach, five years ago, Pace sought a project that needed rehab and rebranding.
May 20, 2019
After selling rebuilt York inn, investor focuses on West End Inn
Courtesy / Diane Pace
Diane Pace purchased the West End Inn, at 146 Pine St. in Portland, as part of a 1031 tax exchange.
After spending five-plus years rebuilding and rebranding the 31-room Lighthouse Inn, at 20 Nubble Road in York Beach, Diane Pace sold it in favor of a new project.
Within a day of the sale, she purchased the six-room West End Inn, at 146 Pine St. in Portland.
Pace’s sale of the Lighthouse Inn closed March 28 for an undisclosed sum. Dana Moos of The B&B Team Inn Consultants and Brokers represented Pace. Don Wunder of Re/MAX Realty One in York represented the buyers, Dole Phiri and Kris Lubanski.
Pace’s purchase of the West End Inn, in the heart of Portland's West End neighborhood, closed March 29 for $1.2 million. Moos represented Pace in the deal.
Pace is a resident of Concord, Mass. For 25 years, she worked in the field of marketing, advertising and brand-building for software and information technology companies.
Lighthouse Inn
She purchased the Lighthouse Inn, which is close by Long Sands and Short Sands beaches and the Nubble Light, because she was ready to leave the corporate world.
The inn was in a rundown condition when she bought it.
“I had an obvious skill set, so buying a place that needed to be rebranded and remarketed was right up my alley,” she said. “I just had to fix it up first. But it had a huge following because of its location.”
The Lighthouse comprises 31 rooms in five buildings on one acre, with a pool and a hot tub.
She bought it with a “five-year plan” in mind, she said. “I said, I’ll turn this into a cool destination for families during the summer and completely rebuild the business and the brand and then sell it. That’s what happened.”
Pace said she left her marketing career behind the day she bought the Lighthouse Inn. She spent most of her time on the property, but didn’t run the inn herself. She had a husband-and-wife management team and a staff of seven in the high season.
“If there’s one thing that I was most proud of at the Lighthouse Inn, it was how many people mentioned how welcome they felt there,” Pace said. “I wanted to sell it to someone who would continue that and not just turn it into a cash cow.”
She found that in Phiri and Lubanski.
“I’m really excited for them,” she said. “I think they’ll be very successful. They’re smart, kind-natured people, which was important to me.”
In a statement provided through Moos, Phiri and Lubanski wrote, "We are excited to be receiving the torch from the previous owner, Diane, who successfully ran the lovely property for the past five years. We are local Maine residents who, combined, have over 30 years of experience in the hospitality industry in the Ogunquit/Southern Maine region.”
Phiri and Lubanski said they will continue to provide and improve on the quality of hospitality provided at the Lighthosue Inn over the last five years.
West End Inn
Pace purchased the West End Inn to help satisfy a 1031 tax exchange, which allows an investor to sell a property, reinvest the proceeds in a new property and defer capital gain taxes. With two children heading for college, she also still needed a steady income.
“Basically, I put the Lighthouse Inn on the market in April 2018 and started looking at new investments,” she said.
The numbers for the West End Inn seemed right. The seller, Victoria Hood, purchased the inn in January 2017 and did a complete rebrand and common area redesign to create a more sophisticated appearance, said broker Moos.
“She increased the ADR [average daily rate] by 30% in two years,” Moos said. “She also remained consistently at the top on TripAdvisor.”
The inn was well-positioned for Pace to take over and continue to increase the ADR and the business, Moos said.
Pace said she was a little nervous about buying an inn that was much smaller than the Lighthouse.
“But it’s in a neighborhood where even something small will be successful year-round,” Pace said. “And Portland is a happening place.”
Mentions of Portland in the national media as a top place to visit, plus commercial activity that includes the construction of new hotels, speak to a thriving tourist economy that hasn’t reached its limit yet, she said.
Then there was the inn’s historic ambiance.
Courtesy / Diane Pace
The West End Inn, built in 1871, features high ceilings, floor-to-ceiling windows and crown moldings.
“I walked in and took one look,” she said of her first visit. “It’s hard not to fall in love with it. It’s a gorgeous little place.”
The brick-faced townhouse-style building was designed by Portland architect John Calvin Stevens and constructed in 1871, according to its website.
It was originally purchased by Freedom Nash, a local stove dealer. It remained a private residence until 1984, when it was converted to a bed-and-breakfast. Portland’s West End is a residential neighborhood with brick-lined avenues and historic architecture.
TripAdvisor rated the inn No. 1 of 11 B&Bs and inns in Portland.
Historic features include crown moldings, 12-foot ceilings, and floor-to-ceiling and arched windows.
Pace began updating the inn when the purchased was finalized. That includes new furnishings, paint/wallpaper, bedding and amenities. She said she expects to upgrade the heating system as well.
“I want to have a more modern vibe that still fits with the beautiful old building, she said.
As part of that, she said, plans include installing an automated wine bar. Similar to a vending machine, it allows guests to buy wine using a credit card. Pressing one button offers a taste of their selection; another button gives them a 4-ounce or 6-ounce pour.
“I think this wine bar will be not only a nice perk for guests, but an incredible talking point,” she said. “From the social media standpoint alone, I think we’ll develop a lot of buzz.”
All together, rehab and equipment investment will likely amount to about $50,000, she said.
“This inn was a no-brainer when I walked in the door,” Pace said. She added that, before she bought it, she was pleased by revenue numbers that indicated a successful business even though it needed updating and did little marketing. “I saw an opportunity.”
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Anonymous
May 21, 2019
Welcome to the neighborhood!
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