By Alex Barreira – Staff Reporter, San Francisco Business Times

Jul 31, 2025

San Francisco saw its greatest number of hotel sales in more than a decade in the first half of 2025, even though a sluggish market persists in the rest of the state.

Ten San Francisco hotels changed hands through the end of June, the most since 2014, with higher deal volume and median price per room than in the first half of 2024. Alameda County also had a much busier year than last, with six deals including the foreclosure sale of the 500-room Marriott City Center in Oakland, the county’s largest.

By contrast, first-half hotel sales across California are down 7% year-over-year, with lower prices per room on both average (16.4%) and median (2.5%) accounts, as described in a report this month from Irvine-based consultancy Atlas Hospitality Group,

“We continue to see a disconnect between buyer and seller expectations,” Alan Reay, Atlas Hospitality President, wrote in the report. “The higher interest rates combined with increased operating costs, especially in labor and insurance, is dampening sales activity. We are seeing an increase in notices of default and foreclosures in certain markets, which is putting additional downward pressure on sales prices.”

San Francisco saw more than twice the number of hotel transactions in the first half of this year than the first half of 2024, headlined by the sale of the 316-room Hyatt Centric Fisherman’s Wharf for $80 million. Because the rest of the cohort comprises smaller deals of less than $15 million — see the chart below — San Francisco historically saw a larger volume, or total rooms, change hands by this time in 2018 and 2022. The median price per room of $132,057 across those deals was a 23% improvement over 2024, but otherwise would have been the lowest first-half mark since 2013.

Hotel investment in San Francisco fell to a record low $83 million in 2024, but the market is poised to rebound with investment in heavily discounted full-service properties as San Francisco sees positive momentum on convention and major sporting events, office attendance and AI-impacted transient business travel, according to a March research report from JLL.

Around the rest of the Bay Area, Santa Clara County saw two transactions, led by the foreclosure sale of the 541-room Signia Hotel in San Jose. San Mateo had one hotel sale, the Travelodge by Wyndham San Francisco Airport North, for $11.5 million. Sonoma County saw a steep 78% drop in hotel transactions through the first half of the year, with just two deals compared with nine through mid-year 2024.