LaSalle Hotel Properties acquires Westin Market Street in San Francisco for $350 million

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Written by Linda Hohnholz

BETHESDA, MD – LaSalle Hotel Properties today announced that it acquired The Westin Market Street in San Francisco, California for $350.0 million.

BETHESDA, MD – LaSalle Hotel Properties today announced that it acquired The Westin Market Street in San Francisco, California for $350.0 million. The Company funded the acquisition with cash on hand and borrowings from its senior unsecured credit facility.

At closing, the Company renamed the hotel Park Central San Francisco. Highgate Hotels will continue to manage the asset as an independent hotel on behalf of the Company. Highgate Hotels also manages Park Central and WestHouse in Manhattan and Southernmost Hotel Collection in Key West on behalf of the Company.

The 681-room hotel is centrally located at 50 Third Street, just steps from Market Street, which bisects San Francisco between the SoMa District and the Financial District. SoMa is a highly diversified submarket, including the neighboring Moscone Convention Center, the Yerba Buena Gardens, the Yerba Buena Center for the Arts (within two blocks of the hotel), AT&T Park and office headquarters for companies such as Twitter, Instagram and Pinterest. In addition to numerous nearby office towers, retail outlets and restaurants, guests benefit from the hotelโ€™s convenient location three blocks from Union Square.

โ€œWe are thrilled to have acquired this prominent hotel with such a fantastic locationโ€ said Michael D. Barnello, President and Chief Executive Officer of LaSalle Hotel Properties. โ€œThe San Francisco lodging market remains very strong, with demand at peak levels and limited supply growth on the horizon, and we are excited about increasing our presence in San Francisco for the second time within 10 months โ€“ marking our seventh hotel in the city. Approximately 17% of our EBITDA is now generated in San Francisco.โ€

โ€œPark Central San Francisco represents an excellent opportunity to expand our relationship with Highgate Hotels and capitalize on cross-selling initiatives with the Park Central in Manhattan.โ€

The hotel was constructed in 1984 and underwent a comprehensive $28.3 million renovation in 2007. The asset has been well maintained since, with $14.0 million invested from 2009 to present. The Company is planning to commence a normal life-cycle renovation in the fourth quarter of 2016.

The hotelโ€™s 681 guestrooms average 347 square feet. The property has 23,000 square feet of flexible meeting and event space, including a 9,000 square-foot ballroom with capacity of up to 1,200 guests. MaSo, the hotelโ€™s only dining outlet, offers locally-sourced cuisine, an outdoor terrace and can host private events for up to 300 guests.

The Park Central San Francisco was purchased fee simple.

The potential hotel acquisition the Company previously disclosed to be under contract in Los Angeles is no longer under contract.

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Avatar of Linda Hohnholz

Linda Hohnholz

Editor in chief for eTurboNews based in the eTN HQ.

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