"This portfolio was probably some of the most sought-after hotel real estate in California during the first half of 2001,"adds Strauss. "A myriad of investors in presented more than 15 offers, with the top bidders being either high-net-worth individuals or regional owner-operators with operating synergies from other hotels."

This investor interest was generated by the stability of the market from both supply and demand perspectives, says Arthur Buser of Jones Lang LaSalle.

"There are high barriers to entry for new hotel development in Monterey given the current hotel building moratorium, so it is unlikely that competitive hotel supply will enter the market any time soon," says Buser.

Buser adds that the area is a major tourist attraction, so the hotels will stay in demand.

Monterey's Cannery Row is a well-known area for shopping and dining, and was made famous by author John Steinbeck's novella, "Cannery Row," who told of a time when the street was filled with whalers, fishermen and cannery owners.

The sales price was not disclosed, but an outside source reported that it went for nearly $40 million. A LaSalle representative confirmed that this price was fairly accurate. The hotels went on the market in January of this year.