Atlas in the news

San Diego Business Journal 11/18/19 Is San Diego Tourism Hitting Peak Hotel? By Tom York https://www.sdbj.com/news/2019/nov/18/san-diego-tourism-hitting-peak-hotel/ Ask the local hotel industry experts, and they’re happy to tell you. San Diego’s hospitality sector has enjoyed an unprecedented period of prosperity over the past decade. They can boast about the high occupancy rates and the high price they can charge for a room. However, those same experts are starting to worry when good news will turn sour. “The hotel industry has been through nine years of record growth,” said Joe Terzi, CEO of the San Diego Tourism Authority, which is spending close to $30 million each year on various marketing activities to lure travelers to the region. 84% Occupancy Rates In Peak Periods Occupancy rates for Central San Diego, for example, have hit record or near record levels, running as high as 84 percent in peak periods. “But we’re now where things are somewhat concerning because of the national political situation and several other issues, such as the strong dollar,” said Joe Terzi, president and CEO of San Diego Tourism Authority. “We think the next several years are going to be challenging.” He said cracks already began appearing in the first quarter…

Los Angeles Business Journal 11/29/19 Los Angeles Ace Hotel Sells for $117M By Hannah Madans https://labusinessjournal.com/news/2019/nov/29/ace-hotel-sells-117-million/ The Ace Hotel Downtown Los Angeles, which helped spur the area’s revival when it opened five years ago on Broadway, has sold for $117 million to an unnamed buyer. The deal by Ace owner Parks Hotels & Resorts Inc. is turning heads, especially because the sale price amounts to $643,000 per room for the 182-room hotel. “That’s one of the highest prices per room paid in downtown Los Angeles,” said Atlas Hospitality Group president Alan Reay. “That says a lot about what people think of the future of downtown L.A. and how they expect the hotel market to perform in the next five to 10 years,” Reay added. “It’s interesting to see that kind of price in light of all the new rooms that are planned or under construction.” Parks Hotels had only recently taken ownership of the property. In September, the group closed its acquisition of Chesapeake Lodging Trust for $2.5 billion, which gave Parks Hotels full ownership of the Ace and 17 other hotels, including the Hilton Checkers Los Angeles in downtown, the Hotel Indigo San Diego Gaslamp Quarter and a handful…

Los Angeles Business Journal 11/07/19 Leasehold Interest in Hotel Near LAX Sells for $50 Million By Hannah Madans https://labusinessjournal.com/news/2019/nov/07/leasehold-interest-hotel-near-lax-sells-50-million/   Sunstone Hotel Investors, Inc. has sold a leasehold interest in the Courtyard by Marriott Los Angeles near LAX for $50 million, according to a third-quarter earnings report. The property has 187 hotel rooms. The purchase price amounts to roughly $267,000 per room. “This transaction not only makes sense financially, but further concentrates our 20-hotel portfolio in Long-Term Relevant Real Estate,” John Arabia, the company’s president and chief executive said in a statement. “We expect to distribute the gain on this sale to our stockholders through our fourth quarter dividend. Additionally, we retain significant liquidity that provides us with the ability to create long-term shareholder value through the continued repurchases of our common stock or through the acquisition of additional Long-Term Relevant Real Estate.” The buyer’s name was not disclosed. Alan Reay, president of Atlas Hospitality Group, said a private company owns the land under the hotel. When ground leases — where one group owns the land and another the building on the land — take place, Reay said they can cause some issues. “It makes it a bit more difficult…

CoStar 10/08/19 Investors to Pay $249 Million, Just Below Luxury Price, for Midprice West Coast Hotels REIT, Singapore Sovereign Wealth Fund Partner on Hotels That Can Withstand a Slow Economy By Clare Kennedy https://product.costar.com/home/news/7587818 Real estate investment trust Summit Hotel Properties Inc. is paying top dollar for four West Coast hotels that are relatively modest size rather than large-scale, full-service luxury hotels popular recently with investors, a move that could signal demand for budget-friendly brands that may hold up in any economic downturn. Summit, based in Austin, Texas, said that it has agreed to pay $249 million for two hotels in California’s San Francisco Bay Area and two in Portland, Oregon, through its recently formed joint venture with GIC, the sovereign wealth fund of Singapore. Half the portfolio is run under the Residence Inn by Marriott flag, and the other half are Hilton Garden Inns, both of which are limited service brands. According to CoStar records, the present owner of the portfolio is BRE Select Hotels Corp., a Brooklyn, New York-based real estate investment trust that focuses on upscale hotels that are run under either Hilton or Marriott brands. The REIT is controlled by Blackstone, a New York-based private equity…

Los Angeles Business Journal 09/27/19 Hilton Leaves His Mark REMEMBRANCE: LA icon influenced more than hotels By Hannah Madans https://labusinessjournal.com/news/2019/sep/27/hilton-leaves-his-mark/ William Barron Hilton, who died Sept. 19 at his home in Los Angeles at the age of 91, had an outsized impact on the city’s business community. The son of hotel mogul Conrad Hilton, he initially eschewed the family business, acquiring a citrus distribution company at age 19. Hilton would eventually assume the reins of his father’s hotel company, where he would transform the hotel chain and, in the process, the industry itself. “I don’t think you can say enough about his impact on the hotel business. Hilton is a huge name in the hotel business in the U.S. and worldwide,” said Alan Reay, president of Atlas Hospitality Group. Reay added that Hilton became known for the “quality of their assets” under his leadership. But Hilton would also make his mark on the business landscape in a number of other ways, ranging from the use of innovative real estate tools to remaking professional football. Here’s a closer look at Hilton’s legacy and some of the areas where he had a lasting impact. In 1959, after oil tycoons Lamar Hunt and…

Sacramento Business Journal 10/02/19 Holiday Inn Express in El Dorado Hills Sold for $21 Million By Emily Hamann https://www.bizjournals.com/sacramento/news/2019/10/02/holiday-inn-express-in-el-dorado-hills-sold-for-21.html A Holiday Inn Express in El Dorado Hills fetched a high price when it sold last month. The 93-room hotel in the El Dorado Hills Town Center sold for $21 million, or $225,806 per room. “This Holiday Inn Express is probably one of the nicest, if not the nicest, well-constructed Holiday Inn Expresses that my firm has ever worked on,” said Justin Myers, vice president of Atlas Hospitality Group, who helped broker the deal. Holiday Inn Express is among the brands owned by Atlanta-based InterContinental Hotels Group (NYSE: IHG). Atlas Hospitality brokered the previous deal when the hotel was last sold for $14.4 million in 2015. The high sale price of the property is another sign of the booming hotel industry in the Sacramento area. “The numbers justify the price per room and the purchase price because the property was performing very well,” Myers said. According to data from Atlas Hospitality, the median hotel sale price in California was $130,025 per room in the first half of the year, which is up 146% over the the last 10 years. Occupancy rates…

Orange County Business Journal 09/19/19 Eagle Four Denver: $80M By Katie Murar https://www.ocbj.com/news/2019/sep/19/eagle-four-denver-work-80m/ A joint venture that includes Newport Beach-based Eagle Four Partners is moving ahead on $80 million in work at the Sheraton Denver Downtown. The group bought the hotel a year ago with High Street Real Estate Partners in Atlanta on undisclosed terms; it had been appraised at $415 million, according to Irvine-based hotel broker and consultancy Atlas Hospitality Group. The Sheraton is currently the largest Denver hotel with more than 1,200 rooms; a 1,500-room Gaylord companies resort opens later this year. Eagle Four’s portfolio includes local properties Paséa Hotel & Spa in Huntington Beach, and Balboa Bay Resort, Balboa Bay Club and the Newport Beach Country Club, all in Newport Beach.

Santa Cruz Sentinel 09/17/19 Fairmont Hotel in Downtown San Jose Plans Wide-ranging Renovations By George Avalos Fairmont Hotel in downtown San Jose plans wide-ranging renovations SAN JOSE — The iconic Fairmont Hotel in downtown San Jose is headed for a wide-ranging facelift for its lobby and other public spaces, according to documents on file with city officials. “We look to improve our property in many different ways,” said Anita Rahman, director of sales and marketing with the Fairmont in San Jose. “This is just one facet of that.” Numerous spots on the ground floor of the Fairmont, arguably Silicon Valley’s best-known lodging place, are slated for a renovation, the city documents show. “This is a beautiful building, a great hotel,” said Mark Ritchie, president of Ritchie Commercial, a real estate firm. “It’s time for this.” The city documents showed numerous elements to the Fairmont renovation project. The lobby; the porte cochere, which is the covered entryway where vehicles can drop off passengers entering the hotel; the entrance to the hotel lobby; lobby corridors; the front desk reception area; the restrooms; the north entry; the elevator lobby; the lounge area; and the bar are tapped for renovation. The cocktail lounge was…

Los Angeles Business Journal 09/13/19 Hotel Plans Proliferate in Hollywood By Hannah Madans https://labusinessjournal.com/news/2019/sep/13/hotel-plans-proliferate-hollywood/ Hotel development shows no signs of slowing, especially in Hollywood. Investor Nathan Korman has filed plans with the city for a seven-story hotel at 1723 N. Wilcox Ave. in Hollywood. The proposal calls for an 81-room hotel with two levels of parking and a roughly 1,900-square-foot rooftop restaurant. Korman requested a conditional use permit that would allow for the hotel project in a residential zone. Last year, Korman filed plans for a seven-story, 68-unit apartment building with retail at the site. Requests for more information were not immediately returned. Korman purchased the property for $500,000 in 1994 from American International Group Inc., according to CoStar Group Inc. The building has 18 units and a 5.6% vacancy rate, according to CoStar. Korman’s project isn’t the only hotel planned for the area. Whitley Apartments has plans for a 10-story hotel with 156 guest rooms at 1719 Whitley Ave., which is currently home to 40 residential units. Developer and restaurateur Adolfo Suaya has proposed a seven-story hotel with 133 guest rooms at 1715 to 1721 N. Wilcox Ave. The hotel would replace a parking lot. One of the major…

CoStar 09/11/19 Anbang Finds Buyer for High-Profile Hotel Portfolio Chinese Insurer Selling Luxury Properties to South Korean Buyer for $5.8 Billion By Lou Hirsh https://product.costar.com/home/news/shared/626975670 China’s Anbang Insurance Group reportedly agreed to sell a portfolio of 15 U.S. luxury hotels for more than $5.8 billion to an affiliate of a South Korean financial services company, three years after it purchased the same properties from private equity giant Blackstone Group as part of a high-profile international expansion. Mirae Asset Global Investments, headquartered in Seoul, plans to acquire the high-profile properties that include Loews Santa Monica Beach Hotel near Los Angeles, the Westin St. Francis in San Francisco, Essex House near New York’s Central Park and InterContinental locations in Miami and Chicago, according to unnamed sources in the Wall Street Journal. The deal does not include what is perhaps Anbang’s most high-profile U.S. hotel, the landmark Waldorf Astoria in New York City. The firm bought it for $1.95 billion in 2015 and has closed it for a renovation. Anbang put the hotels on the market after the insurance firm came under heightened scrutiny from the Chinese government over its purchase of trophy assets including luxury hotels. In February last year, China’s Insurance…

Sacramento Business Journal 09/11/19 Citizen Hotel Sold for $53 Million, Records Confirm By Emily Hamann https://www.bizjournals.com/sacramento/news/2019/09/11/citizen-hotel-sold-for-53-million-records-confirm.html Downtown Sacramento’s Citizen Hotel sold for $53.2 million in July, county records show. That’s $7 million less than what Platinum Equity paid for the property the last time it changed hands, in 2015. In the sale, Miami-based private equity firm Cambridge Landmark purchased the boutique hotel from Beverly Hills-based firm Platinum Equity. Platinum Equity’s 2015 purchase of the property was for $60 million, equating to $303,030 per hotel room, which was believed to be a record purchase price for a Sacramento hotel. The new sale valued the hotel at $271,428.57 per room, which is still higher than other recent hotel sales. According to data from Atlas Hospitality Group, the median hotel sale price in California was $130,025 per room in the first half of the year, which is up 146% over the last 10 years. Representatives of Cambridge Landmark, which specializes in the hotel industry, declined to confirm or comment on the price. Representatives of Platinum Equity did not respond to requests for comment. Jones Lang LaSalle Americas Inc. helped broker the deal. When asked to confirm the price, JLL communications manager Megan Dolan…

CoStar 09/03/19 Onni Group Proposes One of Los Angeles Area’s Largest Hotels Developer Seeks Approval for Over 850 Rooms in Glendale, California By Karen Jordan https://product.costar.com/home/news/813587664 Developer Onni Group has proposed a more than 850-room hotel in Glendale, California, which could become one of the largest hotels by room count in greater Los Angeles. The proposed hotel, at 611 N. Brand Blvd. in downtown Glendale, consists of a 32-story tower and a 28-story tower built on a shared podium with underground and above ground parking, according to city documents. Potential plans include 6,400 square feet of commercial space, according to Mark Berry, principal development officer at the City of Glendale. That could include shops and restaurants, as well as a swimming pool. Onni Group has submitted its plans in the first of a two-step design review process, the preliminary stages of entitlement, but the Glendale City Council will make the final decision on the project, according to Berry. The project would be the largest hotel by room count in the Los Angeles County region known as the Tri-Cities area, which includes Burbank, Glendale and Pasadena, according to hotel brokerage and research firm Atlas Hospitality Group. It would also be among…