L.A. Investor Could Buy Fourth Hotel on S.F.’s Nob Hill
L.A. Investor Could Buy Fourth Hotel on S.F.’s Nob Hill
San Francisco Chronicle
08/28/18
L.A. Investor Could Buy Fourth Hotel on S.F.’s Nob Hill
By Roland Li
A Los Angeles investor appears poised to buy the Huntington Hotel atop San Francisco’s Nob Hill, in what would be his firm’s fourth hotel acquisition in the neighborhood, according to state records.
The potential buyer, Woodridge Capital Partners, previously purchased three of Nob Hill’s largest hotels — the Fairmont, Mark Hopkins and Stanford Court — which have more than 1,300 rooms combined. Woodridge, founded and run by Michael Rosenfeld, sold the Fairmont in 2015 and Mark Hopkins in 2017 for a hefty profit.
A corporation called Mason Palms Ltd. applied last week for a state restaurant license at the 135-room Huntington. Rick Arambulo is listed as an officer of Mason Palms and is also president of Woodridge.
Mason Palms previously applied for similar licenses for the Fairmont, Stanford Court and hotels in Southern California that Woodridge has purchased, strongly suggesting Woodridge is close to acquiring the Huntington as well.
The Huntington’s owner, Grace International of Singapore, is currently in contract to sell the building, said a person familiar with the property who was not authorized to speak publicly about the transaction and requested anonymity. A sale hasn’t closed, according to property records.
Nob Hill has been one San Francisco’s gilded neighborhoods since the 1850s, when it was named after the four wealthy “nabobs” who led Central Pacific Railroad and built mansions atop the hill: Leland Stanford, Collis Huntington, Mark Hopkins and Charles Crocker.
Huntington and Hopkins now have hotels named after them, while Stanford lent the name he shared with his son to a university. The Huntington Hotel also has a restaurant named Big 4 in homage to the railroad barons.
In recent years, San Francisco’s energy has shifted south, as new projects have sprouted up around the newly expanded Moscone Center and the new transit center in the Transbay district. The north side of Market Street has remained relatively static, though the hotels atop Nob Hill have undergone renovations.
Woodridge didn’t respond to requests for comment.
“Nob Hill has been the crown jewel since the start of the century, and it still is,” Woodridge CEO Rosenfeld told The Chronicle in 2014, after he bought the Stanford Court. “It will never go out of vogue, because of its irreplaceable position — and its views — in the center of the city.”
More business travelers are now gravitating toward South of Market hotels, but many tourists still seek out Nob Hill, said Mark Fraioli, a hotel broker with JLL who isn’t involved in the Huntington.
“For people who want the classic San Francisco experience, it’s attractive. It’s taken on more of a cultural and leisure character as the commercial center has shifted south,” Fraioli said.
Nob Hill hotels, along with the rest of the San Francisco, will benefit from the opening of Moscone Center’s new wing next year, said Fraioli. The San Francisco metro area’s revenue per available hotel room dropped 2.4 percent last year, but has rebounded from January through July with a 4.7 percent increase, he said.
“The San Francisco market has generally been attractive to investors because of its very low supply dynamics, and now Moscone is coming back online as a very attractive convention center,” Fraioli said.
Grace International paid $42 million for the Huntington in 2011, according to property records. The Cope family was the seller.
Grace spent $15 million to renovate the hotel with a modern Asian design and renamed it the Scarlet Huntington, sharing a brand name with Grace’s Singapore hotel. Grace declined to comment.
The Huntington’s current asking price isn’t clear. In early 2017, the hotel was being marketed with an asking price of $70 million, said Alan Reay, president of Atlas Hospitality Group, a hotel brokerage firm.
