GlobeSt.com UPDATE: LaSalle Agrees on $91M Hotel Buy

SAN DIEGO-LaSalle Hotel Properties has agreed to put down another strong footprint in the local market. The Bethesda, MD-based hotel REIT has agreed to acquire the 357-room Hilton San Diego Resort for $91.2 million. The deal is expected to close by January 31, 2006, according to LaSalle officials.Built in 1962, the property is expected to undergo $10 million of upgrades, though LaSalle officials say they will hold off on specific comments or changes made to the property until the deal closes. The resort sits on 18 acres along the Mission Bay Park waterfront and features 16,000 sf of meeting-and-function space and 9,600 sf of outdoor meeting space.”San Diego is a strong market in and of itself, and it is growing so there is a lot of upside,” LaSalle CFO Hans Weger tells GlobeSt.com.The acquisition adds to LaSalle’s local holdings. In January, the firm paid $85 million for the Hilton San Diego Gaslamp Hotel. LaSalle acquired the 282-room luxury hotel from locally-based SD Malkin Properties Inc., who developed the hotel in 2000.”The San Diego hotel market has outperformed through the economic downturn, benefiting from healthy convention, meeting and leisure travel. We expect San Diego to continue to be one of the best performing markets in the US,” said Jon Bortz, chairman and chief executive officer of LaSalle Hotel Properties, at the time of the acquisition.The Gaslamp hotel is part of a mixed-use complex known as the Bridgeworks that includes retail, restaurants, parking structures and a full-service spa. As part of the buy, LaSalle took on the hotel, a 116-seat upscale restaurant named New Leaf and the 4,600-sf Artesia Day Spa, while SD Malkin retained ownership of the Fifth Avenue retail component, which is anchored by Lou & Mickey’s Restaurant.LaSalle has a third property in the metro area, Paradise Point Resort and Spa in Mission Beach, a property it acquired in 1998 for $73 million. The hotel is managed by Noble House Hotels & Resorts, which also will manage Hilton San Diego Resort.As earlier reported on Globest.com, LaSalle will also acquire Seattle’s Best Western University Tower and Washington, DC’s Holiday Inn Downtown. In all, the three deals total $166.2 million. The company owns 23 luxury full-service hotels, totaling approximately 7,600 guest rooms in 14 markets throughout the country.