JW Marriott San Francisco Union Square Hotel Sold for $96M

Cushman & Wakefield Sonnenblick Goldman, serving as exclusive financial advisor to Ashford Hospitality Trust, has arranged the sale of the JW Marriott San Francisco Union Square Hotel for $96.0 million to Thayer Lodging Group. The pricing equates to a 3.7% capitalization rate.

Located at the corner of Post and Mason Streets in the prestigious Union Square district of San Francisco, the landmark 21-story atrium hotel was designed by the legendary architect John Portman. The AAA four-diamond hotel is branded and managed by Marriott International and is located within walking distance to world famous destinations such as Chinatown, Nob Hill, the Theater District, the Financial District and Embarcadero, and the Moscone Convention Center.

Built in 1987 and recently renovated at a cost of approximately $22 million, the JW Marriott San Francisco Union Square Hotel is now positioned as one of the premier luxury branded properties in the Bay Area. The hotel has 337 large guestrooms, including eight suites, with every guest bathroom featuring separate shower and tub; 14,000 square feet of meeting and event space, including a 4,350-square-foot ballroom and a state-of-the-art conference center; and two food and beverage facilities. The property is owned under a ground lease, which has a term expiring in 2083.

"The San Francisco lodging market is rebounding strongly and there is upside to the operating performance," commented Stephen O'Connor, senior director of Cushman & Wakefield Sonnenblick Goldman's Los Angeles office. "The offering appealed to a wide spectrum of international hotel investors given the recent comprehensive renovation, high-end market positioning, superior location, and extremely high barriers to entry in this gateway market."

"This was a very competitive sale process and ultimately Thayer presented, and flawlessly executed, the most compelling proposal that met the seller's objectives," said Rob Stiles, executive vice president and head of Cushman & Wakefield Sonnenblick Goldman's west coast operations. "This is a well-timed strategic entry into the market for Thayer and we expect that they will be long term owners of this trophy asset."