Facing $25M loss, Allegiant hires consultant for Port Charlotte resort

Allegiant Travel Co. has hired an outside firm to conduct a strategic review of the recently opened Sunseeker Resort Charlotte Harbor as it deals with the potential of a $25 million loss at the resort this year..

In a note to investors Wednesday morning, the Las Vegas company says the review is aimed at improving the resort’s “financial performance and (to) help accelerate the strategic positioning of the hotel in conjunction with the existing experienced management team.”

That news was followed later in the day by an update included in a second quarter earnings statement saying the company expects to see a $25 million loss at the resort this year. That loss will be somewhat mitigated, however, because it will receive up to $10 million from its business interruption insurance for delays in opening the resort.

In the earnings report, the company announced the resort’s total operating revenue for the second quarter was $16.8 million and that occupancy was “roughly” 35% with an average daily rate of $260.

That’s down from earlier this year when it announced in May that total operating revenue for the first quarter was $23.9 million and occupancy was about 40%, with an average daily rate of $330.

“Regarding Sunseeker,” chairman and CEO Maurice J. Gallagher, Jr. says in the earnings statement, “we continue to believe this one-of-a-kind resort holds greater value than currently reflected. To realize its full potential, however, we have engaged Prospect Hotel Advisors to conduct a strategic review of the property.”

Prospect Hotel Advisors, according to the note, “has played an essential role in maximizing the value of hotels through the repositioning of hundreds of assets and transactions worldwide.”

A company spokesperson did not immediately respond to questions about why there was a need to bring outside consultants in or whether it was preparing to sell the resort.

But in the note, company president and incoming CEO Gregory Anderson says Prospect's expertise at positioning hotels to increase “strategic alternatives will be key as we identify the right path forward.”

Sunseeker was once seen as a boon for the airline, a hub where it could funnel its travelers to a beachfront resort and an expansion into the hospitality industry. But it opened in December three years late and about $225 million over budget, thanks in large part to the pandemic and damage from Hurricane Ian.

The 785-room resort has 20 restaurants and bars, two pools, a spa and salon, a 117,000-square-foot “ground-level experience,” an adults-only rooftop retreat, 60,000 square feet of meeting space, a harbor walk, and an 18-hole golf course.

This story was updated to reflect the new earnings report.