Buchanan Street Partners, a real estate investment bank that also manages assets for institutions and brokers sales, is not disclosing the name of the seller or the expected sale price. While the seller's name was not otherwise available, local industry sources tell GlobeSt.com the property should fetch a price north of $20 million (about $220,000 per key) based on the recent sales of comparable properties.
The hotel is currently managed by the Kimpton Hotel and Restaurant Group; however, the management agreement may be assumed or terminated by the buyer upon sale.
Buchanan Street SVP Curtis Davies tells GlobeSt.com the hotel could be upgraded to a higher class, converted to a condo-hotel development or converted to straight residential. The "condotel" play may be the most attractive because it would be the first in the city. The property gets around the moratorium on hotel-to-condo conversions by having fewer than 100 rooms.
"The new owner could reap the reward of selling the rooms to individual hotel condominium buyers," Davies says.
Located at 127 Ellis St., the hotel sits between Union Square and the expanded San Francisco Centre. The expansion, which includes a new Bloomingdale's, movie theaters, restaurants and office space, is set to open in September. The hotel also is within walking distance of the theater district, Moscone Convention Center, Financial District and the Powell Street cable car line that carries passengers to Fisherman's Wharf.
Several San Francisco hotels have changed hands in recent weeks and months. In the similar-sized boutique arena, Greystone Hospitality of San Francisco paid $15.25 million, or $246,000 per key for the 62-room Griffon Hotel, one of only three hotels located along the Embarcadero. Buchanan Street's Davies was the listing broker. The property sold in just three months.
Recent sales of larger hotel properties include the 360-room Park Hyatt hotel in the Financial District, which sold in early May for about $126 million, or $350,000 per key, and was re-branded a Le Merdien. On April 20, Ashford Hospitality Trust of Dallas acquired the 338-room Pan Pacific San Francisco Hotel for $95-million, or $281,065 per key, and re-branded the property a JW Marriott hotel. At the end of March, the Argent hotel on Third Street between Market and Mission was sold for $178 million, or $258,000 per key, and may be converted to a Westin.
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