Name: Historic downtown San Diego hotel sold for third time in last decade
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Historic downtown San Diego hotel sold for third time in last decade

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Copyright © 2022, The San Diego Union-Tribune | | AdvertisementAdvertisement The downtown Courtyard San Diego hotel, which began life in the 1920s as a bank, has been sold for $64.5 million to Pimco, a global investment management firm headquartered in Newport Beach.While the seller, Hersha Hospitality Trust, would not divulge the name of the buyer, Pimco is identified as the new owner by real estate tracker CoStar. It was also confirmed by Alan Reay, president of the hotel brokerage firm, Atlas Hospitality Group, based in Orange County.The purchase price is $6.5 million less than what the 245-room hotel previously sold for in 2013, when Philadelphia-based Hersha purchased it for $71 million from its then owner, Wheelock Street Capital. Wheelock bought the hotel in 2011 for $61.1 million.AdvertisementRepresentatives of Pimco did not respond to calls and emails seeking comment on the purchase.Reay, who believes this is the first California hotel to be purchased by Pimco, said he’s not surprised that the hotel sold for a considerable discount, given the toll the pandemic has taken on real estate values in the hospitality industry. Based on market values pre-COVID-19, he expects the downtown hotel would have sold for $84 million were it not for the pandemic.“Everyone has a different opinion on when things will come back, and when you have a downtown business hotel, that will take a longer time to come back than a beachside hotel,” Reay said. “In the middle of COVID last year, discounts on hotel properties were between 40 and 50 percent. This is about a 24 percent discount.”Located at 530 Broadway, the historic 14-story Courtyard by Marriott hotel features a lobby restaurant and a full bar, a billiards room, and 24-hour fitness center. Built in 1927 as the San Diego Trust &amp; Savings Bank, the property was converted to a hotel in 1999 and most recently renovated in 2013. The $27 million transformation of the bank into a hotel was undertaken by Ltd.The bank’s original 35 columns, faced with marble from the U.S., Europe and Asia, remained in place, as did the circular chandeliers, coffered plaster ceiling and bronze teller wickets. A meeting space known as the Safe Deposit Room boasts the original 47,000-pound Mosler Safe Company door from 1928. And the bank’s 32-foot-high lobby space became the hotel’s grand lobby.Reay suspects that Hersha was motivated to sell because it needed to free up capital after having to walk away recently from seven of its New York City hotel properties. Earlier this year, the firm, Mack Real Estate, , owned by a joint venture between Hersha and Chinese investment firm Cindat Capital Management, according to The Real Deal, a publication that tracks real estate news.Reay noted that Hersha had no debt on the San Diego property.“I’s a beautiful historic hotel, and I think you’ll find that Pimco made a great acquisition,” Reay said. “There’s long-term upside, and this is a property that is valued at well below replacement cost.” Get U-T Business in your inbox on Mondays Get ready for your week with the week’s top business stories from San Diego and California, in your inbox Monday mornings. You may occasionally receive promotional content from the San Diego Union-Tribune. Show Comments Load More Advertisement Advertisement AdvertisementAdvertisementAdvertisement

Copyright © 2022, The San Diego Union-Tribune | | AdvertisementAdvertisement The downtown Courtyard San Diego hotel, which began life in the 1920s as a bank, has been sold for $64.5 million to Pimco, a global investment management firm headquartered in Newport Beach.While the seller, Hersha Hospitality Trust, would not divulge the name of the buyer, Pimco is identified as the new owner by real estate tracker CoStar. It was also confirmed by Alan Reay, president of the hotel brokerage firm, Atlas Hospitality Group, based in Orange County.The purchase price is $6.5 million less than what the...

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Lori Weisberg

The San Diego Union-Tribune, the region's leading news source since 1868. Follow our journalists, too: http://j.mp/UTstaff

Historic downtown San Diego hotel sold for third time in last decade

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