Hotel Palomar in Downtown San Francisco Sold
Jones Lang LaSalle Hotels Arranges Sale; Kimpton Stays On as Manager of Heralded San Francisco Asset
On behalf of Kimpton Group Holding LLC, Jones Lang LaSalle Hotels has arranged the sale of the 195-room Hotel Palomar, located at 4th and Market Streets, in downtown San Francisco, California. The property was sold to Griffin Capital, a Los Angeles-headquartered, privately-owned real estate investment company, who has had tremendous success with its commercial investment products targeted at individual investors seeking fractional 1031 opportunities, or TICs. While the Palomar is Griffin’s first acquisition of a hotel, it is the fifth recent acquisition in the Bay Area.
The Hotel Palomar’s residential-style lobby reflects the overall theme of the hotel, “Art in Motion,” boasting a wood parquet floor modeled after MC Escher’s famous drawings. The hotel’s 195 guestrooms reflect a modern elegance and have recently undergone a substantial soft goods renovation to allow the property to further penetrate its competitive supply. One of the hotel’s prized attributes is the Fifth Floor, the Hotel Palomar’s Michelin rated fine-dining restaurant. This signature restaurant is scheduled for a substantial renovation that will enhance the hotel’s position as the premier, luxury boutique hotel in the market.“The Hotel Palomar is one of the leading hotels in San Francisco,” said Arthur Buser, president – lodging capital markets–Americas for Jones Lang LaSalle Hotels. “The hotel’s location at 4th and Market places it in the vibrant South of Market district – which is rapidly becoming the new heart of San Francisco – and a few blocks from the popular tourist hub of Union Square. The development of Westfield’s nearby retail megaplex, the San Francisco Centre, and a number of luxury residences is evidence of the influx of notable, high-end development right in the Palomar’s neighborhood.”
“Investors respond very well to Kimpton’s management expertise and the results that they deliver for their owners. Kimpton was the original lifestyle boutique hotel brand, and they have built on the last 26 years of experience to develop a world-class management team,” said Arthur Adler, managing director and CEO– Americas for Jones Lang LaSalle Hotels. “Similar to their tremendous success with the Hotel Monaco style of hotels, the Hotel Palomar San Francisco and the growing ranks of additional Hotel Palomar properties are already beginning to redefine success in the boutique hotel segment.”
“The Palomar San Francisco holds a special significance for Kimpton, and we’re pleased to see it under ownership of Griffin Capital,” said Michael Depatie, Kimpton’s president and CEO. “It was the prototype for what’s become one of our most successful styles of hotels and has driven demand for Palomars in other cities. We look forward to continuing to deliver the Kimpton brand of service, amenities and unique guest experiences that set us apart from other hotel companies.
“We are also pleased to add yet another high-quality investor to our growing list of third-party owners and look forward to expanding our relationship with Griffin Capital to additional Kimpton branded hotels,” Depatie said.
About Jones Lang LaSalle Hotels: Jones Lang LaSalle Hotels, the first and leading global hotel investment services firm, is uniquely positioned to provide both the depth and breadth of advice required by hotel investors and hotel companies, through a robust and integrated local network. In 2006, Jones Lang LaSalle Hotels provided sale and purchase advice on 186 hotel transactions globally; representing a combined value of US$9.3 billion, a total of 43,272 hotel rooms in 78 cities. In addition advisory and valuation services were provided on 589 assignments globally for 136,270 rooms across approximately 280 cities.
The global team comprises 210 hotel specialists, operating from 24 offices in 14 countries. The firm’s advice is supported by a dedicated global research team, which produced over 45 publications in 2006 in addition to client research. Jones Lang LaSalle Hotels’ services span the hospitality spectrum, from luxury single assets and large portfolios to select service and budget hotels, resorts and pubs. Their services include investment sales, mergers and acquisitions, capital raising, valuation and appraisal, asset management, strategic planning, operator selection, management contract negotiation, consulting, industry research and project development services. Jones Lang LaSalle Hotels’ clients have access to the resources of its parent company, Jones Lang LaSalle (NYSE: JLL).
About Griffin Capital: Griffin Capital is a privately owned real estate company focused on offering industry-leading real estate investment products for individual investors seeking Co-Ownership in Real Estate (CORE) tenant-in-common tax deferred exchange opportunities. Led by senior executives, each with more than two decades of real estate experience collectively encompassing over $14 billion of transaction value and more than 400 transactions, Griffin Capital has acquired or constructed approximately ten million square feet of space since 1996. Griffin Capital currently owns and manages a portfolio consisting of 36 assets, approximating 7.8 million square feet of space, located in 12 states. Griffin Capital is headquartered in Los Angeles with offices in Chicago and Greenwich, CT. Additional information is available at .
Kristina Paider (JLL)
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