Atlas in the news
California Hotel Property Sales at Record High Values
The Registry 09/03/15 California Hotel Property Sales at Record High Values By Robert Carlsen http://news.theregistrysf.com/california-hotel-property-sales-at-record-high-values/ California hotel sales reached a record dollar volume of more than $4.4 billion in the first six months of 2015, a 64 percent increase over the same period in 2014, according to Atlas Hospitality Group’s recently completed 2015 Mid-Year California Hotel Sales Survey. This total dollar amount for a six-month period was greater than any annual total in the history of state hotel sales, except for 2006, Atlas added. Other statewide figures show unprecedented activity and results, including the median sales price per room increasing 25 percent and 13 deals that traded in $100 million-plus range versus four for the same period in 2014. Despite all the increases, the number of individual hotel sales actually declined 7 percent. The Irvine-based brokerage and research firm said that Northern California increased 83 percent in total dollar volume and Southern California was up 51 percent. In the first half of 2015, San Francisco City and County saw a 58 percent decrease in sales transactions, but a 120 percent increase in total dollar volume. “Even though we are seeing fewer sales, we are seeing more expensive transactions and bigger…
Four-Diamond JW Marriott Proposed for Disneyland Area
The Orange County Register 08/29/15 Four-Diamond JW Marriott Proposed for Disneyland Area By Art Marroquin http://www.ocregister.com/articles/anaheim-680062-hotel-city.html ANAHEIM – A developer has submitted plans to build a luxury hotel at the GardenWalk mall near Disneyland, becoming the first to take advantage of a hefty city subsidy that aims to entice more-affluent tourists to stay in Anaheim. The JW Marriott Anaheim would rise 12 stories with 466 guest rooms, ballrooms and meeting rooms on a 2.8-acre dirt lot near Katella Avenue and Clementine Street, within walking distance of Disney’s theme parks and the Convention Center. It would cost $150 million-plus to build the hotel, financed in large part by a 70 percent return on bed taxes collected there over 20 years. Opponents have challenged the deal in court. Despite the ongoing legal battle, developer Bill O’Connell Sr. said that “the time was right to move ahead,” and an application was filed Wednesday with Anaheim’s Planning Department. “With the JW Marriott, we are bringing a highly respected hotel brand that will do great things by creating jobs, boosting the hotel industry and attracting bigger and better conventions to Anaheim,” said O’Connell, head of O’Connell Hotels & Hospitality. He is developing the hotel with…
Unique Issues Impact Hotel Performance
GlobeSt.com 08/24/15 Unique Issues Impact Hotel Performance By Carrie Rossenfeld http://www.globest.com/news/12_1181/orangecounty/hotel/Unique-Issues-Impact-Hotel-Performance-361016-1.html IRVINE, CA—Hotel owners have to deal with a myriad of issues that most commercial real estate investors don’t face, such as union labor, minimum-wage issues, ADA regulations and a host of others, Atlas Hospitality Group president Alan Reay tells GlobeSt.com. After the release of the firm’s mid-year California hotel-sales survey, we spoke exclusively with Reay about what it takes to be successful in the hotel sector. GlobeSt.com: What qualities do the most successful hotel investors have? Reay: First and foremost, it is management skills or having an association with a skilled hotel-management company. Second, it is knowing your product and market so you have the ability to move quickly when the right hotel becomes available for sale. Last but not least is capital and the ability to move on a purchase with very short contingencies, which can put you ahead of the other buyers trying to acquire. GlobeSt.com: What are the most popular types of hotels for investors today? Reay: This falls in to two main categories: 1. trophy hotels in “A” locations and 2. upper limited-service hotels, 10 years or newer, e.g., Hilton/Marriott brands. Examples are Residence Inn…
California Raisin’ Prices as Deal Volume Drops
HotelNewsNow 08/26/15 California Raisin’ Prices as Deal Volume Drops With construction limited by available space and high costs, hoteliers in California are spending top dollar to buy existing properties. By Bryan Wroten http://www.hotelnewsnow.com/Article/16541/California-raisin-prices-as-deal-volume-drops REPORT FROM THE U.S.—Hoteliers spent a total of $4.4 billion in hotel sales in California during the first six months of 2015, an amount that outpaces every full-year total for the state since 1994 except for 2006, according to the Atlas Hospitality Group’s mid-year sales survey. The survey found that while the number of transactions between 1 January and 30 June 2015 decreased year over year from 2014, the sales prices increased by almost 64%. Thirteen transactions surpassed $100 million this year, compared to four in the first half of 2014. “For six months, it’s an absolutely phenomenal number,” said Alan Reay, president of Atlas. The decline in the number of transactions from mid-year 2014 (187) to mid-year 2015 (174) wasn’t much of a surprise, he said. The state saw a new sales record with 399 transactions for the full year of 2014, he said. In reviewing the average sale prices, Joel Hiser, principal for HTL Hospitality Advisors, cautioned that some of the more expensive transactions will…
Hotel Sales Hearken Ghosts of 2006
Bisnow 08/20/15 Hotel Sales Hearken Ghosts of 2006 https://www.bisnow.com/archives/newsletter/local-real-estate/san-diego/5913-hotel-sales-hearken-ghosts-of-2006/ The exceptional hotel investment market is reminiscent of the Great Recession. But it’s not all bad news, and Atlas Hospitality president Alan Reay says its the best he’s seen the business perform in the last 25 years. In Atlas’ mid-year California investment report—which tracks hotel buys in the state—sales stats are very reminiscent of 2006, the peak year before the investment market (and entire US economy) crashed in the credit crunch. More than $4B in hotels traded so far this year, a 64% jump from the same period in 2014, including a 51% jump in sales in Southern California. Alan says these sales have been shadowed by RevPAR improvements as a whole. And that has fed an investor frenzy fueled by low interest rates and a chase for yield that appears better than other real estate assets. But Atlas data shows investments were wildly uneven throughout the state. In San Diego County, prices paid by investors per room spiked 43% to $192k/room. Places like San Francisco and LA saw even crazier jumps: 124% to $489,300/room and 240.5% stratospheric rise to $305k/room, respectively. In San Diego, the largest hotel sold so far…
San Diego County Hotel Property Deals Declined in First Half
San Diego Business Journal 08/18/15 San Diego County Hotel Property Deals Declined in First Half By Lou Hirsh http://sdbj.com/news/2015/aug/18/san-diego-county-hotel-property-deals-declined-fir/ The volume of San Diego County’s hotel property sales transactions declined 16 percent from a year ago in the first half of 2015, while the dollar volume of those deals slipped 1 percent, according to a newly released mid-year report by brokerage and research firm Atlas Hospitality Group. San Diego County saw a total of 16 hotels change hands in the first half, in deals totaling $696.5 million. The region’s largest hotel sold was the 419-room Hyatt Regency La Jolla at Aventine, purchased for $118 million by affiliates of Chicago-headquartered Walton Street Capital LLC and San Francisco-based JMA Ventures LLC. The biggest local transaction of the first half was the $259 million deal in which Blum Capital and the parent of Fairmont Hotels & Resorts purchased a majority stake in the 249-room Grand Del Mar in Carmel Valley, from Douglas Manchester. That property is now known as Fairmont Grand Del Mar. Atlas officials said California as a whole saw a record $4.4 billion in hotel transactions, including 13 properties that went for more than $100 million. That occurred even as the…
Have Frenzied Buyers Pushed California Hotels to Bubble Pricing?
The Orange County Register 08/18/15 Have Frenzied Buyers Pushed California Hotels to Bubble Pricing? By Jonathan Lansner http://www.ocregister.com/lansner/hotels-678128-strategic-hotel.html Perhaps “For Sale” should go next to the “No Vacancy” sign. A record flood of dollars is being spent on California hotels this year, a buying binge that has induced the owner of two iconic Orange County luxury resorts to consider a sale. Strategic Hotels & Resorts Inc. – owner of 18 luxury hotels including the 393-room Ritz-Carlton Laguna Niguel and the 250-room Montage Laguna Beach – said Monday it is “exploring possible strategic alternatives for the company, including the potential sale of the company.” The news comes as Atlas Hospitality Group of Irvine reports a record $4.4 billion was spent to buy 174 California hotels in the first half of the year. While 13 fewer hotels were sold vs. 2014, this year’s six-month dollar total – up 64 percent vs. 2014’s pace – surpasses the annual total of every year but 2006. The buying spree certainly raises questions about the sanity of hotel valuations when you note that Atlas’ first-half median selling price for California is up 65 percent in three years. I don’t want to say “bubble” … but you…
California Hotel Sales Hit New Record
Hotel Management 08/18/15 California Hotel Sales Hit New Record By Elliott Mest http://www.hotelmanagement.net/operations-management/california-hotel-sales-hit-new-record-32320 The hospitality industry continues to show strong signs of life as sales of California lodging properties during the first half of 2015 were revealed to have surpassed all previous records. According to The San Diego Union-Tribune, hotel sales in California reached over $4.4 billion in the past six months, overtaking all previous midyear totals for the state since Orange County-based Atlas Hospitality Group began tracking sales activity in 1994. In fact, this year’s midyear total is even above the volumes recorded for all full years of sales, excluding 2006. Atlas Hospitality president Alan Reay told The San Diego Union-Tribune that the industry can’t maintain the pace that has been seen over the past 12 to 18 months. 2015 began with a bang, with the state’s Montage Laguna Beach and Westin Market Street each selling for over $300 million. However, sales in San Diego County were actually down for the first half of this year compared to 2014, but the difference was made up by the average selling price for hotels in the County increasing more than 43 percent to $191,663. Over 13 transactions have taken place in…
California Hotel Sales Hit a New Record
The San Diego Union-Tribune 08/17/15 California Hotel Sales Hit a New Record By Lori Weisberg http://www.sandiegouniontribune.com/news/2015/aug/17/california-hotel-sales-new-record-first-half-2015/ The hotel industry is indisputably back from the depths of the recession, with sales of California lodging properties during the first half of this year surpassing all previous records. There were more than $4.4 billion in sales transactions in the first six months of 2015, a volume that eclipsed all previous midyear California totals since 1994 when the Orange County-based firm, Atlas Hospitality Group, first began tracking sales activity. In fact, the prices being paid for hotels has grown so much that the midyear total surpassed volumes recorded for all full year of sales, with the exception of 2006, Atlas found. “We simply can’t maintain the pace seen over the last 12 to 18 months,” said Atlas Hospitality President Alan Reay…
Hot Properties: Investors Snap Up California Hotels with Record Spending
The Orange County Register 08/07/15 Hot Properties: Investors Snap Up California Hotels with Record Spending By Jonathan Lansner http://www.ocregister.com/lansner/year-678002-hotels-california.html Investors are paying record amounts for California hotels with spending on pace to exceed any previous year. Atlas Hospitality Group of Irvine reports a record $4.4 billion was spent for 174 California hotels in the first half of the year. While that’s 13 fewer hotels sold vs. 2014, this year’s six-month dollar total – up 64 percent vs. 2014 – surpasses the annual dollar volume of every year but 2006. California investors liked larger hotels, with the median room count of properties sold rising to 60 from 47 in 2014. Meanwhile, the median price per room paid rose 25 percent to $91,000. Key to the buying boom is the hotel industry’s record profits, which attract buyers who are using low interest rates and plentiful financing to make deals. Orange County had similar shopping patterns. The number of first-half deals fell by three to 11 compared to a year ago. Yet dollars spent by buyers soared by 45 percent to $749 million. Investors are paying up for bigger local hotels, too. The median sale price of an Orange County hotel was $32…
Record Hotel Room Revenues Here, Elsewhere
The Daily Transcript 08/14/15 Record Hotel Room Revenues Here, Elsewhere By Thor Kamban Biberman http://www.sddt.com/News/article.cfm?SourceCode=20150814czc&_t=Record+hotel+room+revenues+here+elsewhere The mid-year average price per hotel room increased by more than 43 percent year over year, according to an Atlas Hospitality Group report. The average price-per-room figure climbed in San Diego by 43.25 percent from $133,791 at mid-2014 to $191,663 by mid-2015. The average price-per-room increases in San Diego County and the rest of the state were so strong that Alan Reay, Atlas Hospitality president, says they are completely unsustainable. “This has been a record-breaking six months. I don’t see how this could keep up next year. I can’t see how these increases in RevPAR (revenue per available room) can continue,” Reay said, adding that the low cost of capital has helped to fuel the purchases. The combined dollar hotel sales volume in San Diego County amounted to $696.54 million through June — off just slightly from $701.08 million in the first half of last year. While the average price of a sold hotel in San Diego County was $43.53 million, the median price was just $5.62 million — meaning that smaller hotels accounted for the bulk of the sales transactions. The median figure was…
High-End Hotel Properties Up Ante on Luxury
San Diego Business Journal 08/06/15 High-End Hotel Properties Up Ante on Luxury TRAVEL: Downtown Arrivals May Pressure Others Into Renovations By Lou Hirsh http://www.sdbj.com/news/2015/aug/06/high-end-hotel-properties-ante-luxury/ Luxury hoteliers appear to be reaping the biggest returns in a healthy local and national tourism economy, and observers say the roster of new hotels on tap for downtown San Diego could significantly raise the posh quotient in places including East Village and the Gaslamp Quarter.
