San Jose Hotels Moving Ahead, Revived with New Financing

San Jose Hotels Moving Ahead, Revived with New Financing

The Mercury News

San Jose Hotels Moving Ahead, Revived with New Financing
By George Avalos


SAN JOSE — Developers are pushing ahead in north San Jose with an unusual lodging concept: a complex with two hotel brands that would share a common lobby.

Together, the two hotels would bring 261 new lodging rooms to a section of north San Jose that is a short distance from the headquarters of some of Silicon Valley’s biggest tech companies, including Google, as well as the Levi Stadium sports complex and California’s Great America amusement park.

The development would consist of a 147-room Residence Inn and a 114-room Fairfield Inn & Suites, both operating under the Marriott brand.

What’s unusual about this development is the two hotels would share a lobby and other common areas.

Saratoga-based InfiniPower Hospitality Group is developing the complex. Each hotel would each be four stories high.

“This would be a new concept,” said Devang Shah, founder and principal executive with InfiniPower Hospitality. “Marriott and some other hotel chains are promoting this co-branding approach. You will have two hotels in one building. They would share the public spaces, the front desk, the food and beverage areas and all the joint amenities.”

The project, located north of the interchange of State Route 237 and Great America Parkway, is under construction and would be part of the America Center, a complex of office towers and hotels.

The construction was bolstered by $19 million in equity financing supplied by Los Angeles-based Canyon Partners Real Estate, an investment firm.

The hotels are being built near an array of major tech company operations. The lodging project is within a few miles of offices occupied by Cisco, Adobe, Hitachi, Intel, Google, Oracle, Dell and Broadcom, the developers said.

“Both of these hotels should be a huge success,” said Alan Reay, president of Atlas Hospitality Group, which tracks the lodging market in California. “They have both the branding and the location. This development checks all the boxes.”

An outdoor pool and patio area with a fire pit, enhanced fitness center, bar, complimentary breakfast area, guest laundry facilities and a 24/7 sundry shop, as well as 1,200 square feet of meeting space and a business center will be part of the proposed hotel complex.

The developers hope to open the hotels by mid-2019.

InfiniPower bought the site in 2006 and proposed a recreation and social club with private membership. San Jose officials approved that project, but then the Great Recession descended on the nation and the Bay Area, and all development plans were halted.

“We put everything on hold,” Shah said.

Then came word that the San Francisco 49ers intended to shift their operations and football games to Santa Clara and in 2014, Levi’s Stadium opened, which swiftly changed the economic dynamics and development prospects for Santa Clara and north San Jose.

“We looked at all our options and decided to pursue this as a hotel development,” Shah said.

Dual operation hotel complexes are a growing segment of the industry, according to Reay.

“This is becoming very popular for hotel developments,” Reay said. “They can keep the operating and construction costs down.”

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