Ultima Hospitality, a Chicago-based hotel investment and management company, on Wednesday acquired the 397-room Westin San Francisco Airport and the 252- room Aloft San Francisco Airport from Starwood Hotels & Resorts for US$125 million.
The two hotels will move to a franchised structure under Ultima Hospitality and the Westin will undergo capital improvements, including extensive upgrades and renovations of the guestrooms, meeting space, public space and lobby.
“The Greater San Francisco economic expansion coupled with a general lack of both past and future hotel supply growth is a dynamic which has drawn us to target further investment within the Bay Area,” said Nir Liebling, chief investment officer. “The airport submarket of San Francisco in particular should continue to realize outsized RevPAR growth due to the robust and diverse local demand drivers proximate to these two properties, as well as very strong downtown compression. The Westin and Aloft are our third and fourth acquisitions of 2013 and we at Ultima are excited to grow our platform in partnership with Starwood and the Starwood family of brands.”
According to Mark Zettl, chief operating officer of Ultima Hospitality, these additions increase Ultima’s platform to 2,255 rooms and it employee count from 700 to approximately 1,000.
For Starwood, this sale underscores its commitment to an asset-light strategy. “With favorable capital market conditions and improving hotel industry fundamentals, we’re seeing continued strong investor interest in our remaining assets,” said Simon Turner, president of global development for Starwood. “Our goal is to form relationships with partners like Ultima Hospitality, who share our vision for the assets they purchase to be brand-enhancing properties.”