SAN FRANCISCO—LaSalle Hotel Properties has revealed that it acquired The Westin Market Street in San Francisco for $350 million. The company funded the acquisition with cash on hand and borrowings from its senior unsecured credit facility.
At closing, the company renamed the hotel Park Central San Francisco. Highgate Hotels will continue to manage the asset as an independent hotel on behalf of the company.
Highgate Hotels also manages Park Central and WestHouse in Manhattan and Southernmost Hotel Collection in Key West on behalf of the Company.
The 681-room hotel is centrally located at 50 Third St., just steps from Market Street, which bisects San Francisco between the SoMa District and the Financial District. SoMa is a highly diversified submarket, including the neighboring Moscone Convention Center, the Yerba Buena Gardens, the Yerba Buena Center for the Arts (within two blocks of the hotel), AT&T Park and office headquarters for companies such as Twitter, Instagram and Pinterest. In addition to numerous nearby office towers, retail outlets and restaurants, guests benefit from the hotel's convenient location three blocks from Union Square.
“We are thrilled to have acquired this prominent hotel with such a fantastic location” says Michael D. Barnello, president and CEO of LaSalle Hotel Properties. “The San Francisco lodging market remains very strong, with demand at peak levels and limited supply growth on the horizon, and we are excited about increasing our presence in San Francisco for the second time within 10 months—marking our seventh hotel in the city. Approximately 17% of our EBITDA is now generated in San Francisco.”
The hotel was constructed in 1984 and underwent a comprehensive $28.3 million renovation in 2007. The asset has been well maintained since, with $14.0 million invested from 2009 to present. The Company is planning to commence a normal life-cycle renovation in the fourth quarter of 2016.
The hotel's 681 guestrooms average 347 square feet. The property has 23,000 square feet of flexible meeting and event space, including a 9,000 square-foot ballroom with capacity of up to 1,200 guests. MaSo, the hotel's only dining outlet, offers locally-sourced cuisine, an outdoor terrace and can host private events for up to 300 guests.
The Park Central San Francisco was purchased fee simple.
The potential hotel acquisition the company previously disclosed to be under contract in Los Angeles is no longer under contract.
As GlobeSt.com reported in December, LaSalle Hotel Properties had plans to acquire three hotels in Los Angeles, Portland, OR, and San Francisco for an aggregate purchase price of $500 million. The REIT tipped its hand about the purchase when it revealed the sale of 7.6-million common shares in a public offering. It said it would use the net proceeds of the offering to "fund all or a portion of the cost of future expected hotel acquisitions…" including the three aforementioned properties, as GlobeSt.com reported.
Continue Reading for Free
Register and gain access to:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
