St. Regis Monarch Beach Prepared by: 1901 Main St, Ste 175 Irvine, CA 92614 Telephone (949) 622 3400 Facsimile (949) 622 3410 Alan X. Reay, President E mail: alan@atlashospitality.com
Table of Contents 1. Summary of California Highlights 2. Regional Highlights: Southern California 3. Regional Highlights: Northern California 4. Recap 5. Forecast List of Tables 1. Northern California vs. Southern California 2. Southern California Highlights 3. Northern California Highlights
Summary of California Highlights The number of California hotel sales jumped 80.4% to 166 in 2010, up from 2009 s record low of 92. The total dollar volume of California sales was up 240.6%. The median price per room in California dropped 5.2%. Northern California was down only 1.7%, but Southern California decreased 17.9%. Alameda County had the largest median price per room decline, down 33.4%. San Francisco County had the biggest increase in the number of sales, up 650%. Los Angeles County followed with 575%. The 479 key La Costa Resort & Spa in Carlsbad was the largest hotel to sell. The most expensive sale, on a per room basis, was the St. Regis Monarch Beach in Dana Point at $587,500 per room.
Southern California Highlights Los Angeles County Los Angeles County saw a 575% increase in the number of individual hotel sales in 2010, from 4 to 27. The total dollar volume rose 886.5%. The county s average price per room increased 118.2% and the median price per room was up 226.4%. The largest hotel sold in Los Angeles County was the 469 room Los Angeles Marriott downtown, which sold for $63 million. The most expensive hotel sold, at $102.8 million, was the 309 room Sheraton Delfina in Santa Monica. Sheraton Delfina Santa Monica San Diego County San Diego County had a 150% increase, from 6 to 15, in individual transactions. The total dollar volume increased 389.8%. San Diego County s average price per room rose 10.6%, but the median price per room was down 13.4%. The largest and most expensive sale was the $125 million paid for the 479 unit La Costa Resort & Spa in Carlsbad. La Costa Resort & Spa Carlsbad Orange County Individual transactions in Orange County increased 12.5%, from 8 to 9. The total dollar volume went up 431.4%. The average price per room rose 102.7%, but the median price per room decreased 17%. The largest and most expensive hotel sale in Orange County was the $235 million paid for the 400 room St. Regis Monarch Beach in Dana Point. St. Regis Monarch Beach Dana Point
Riverside County Riverside County experienced a 100% increase in transactions, from 7 to 14. However, the total dollar volume dropped 31.5%. The average price per room dropped 10% and the median price per room decreased 21.4%. The largest and most expensive sale came from the $6.575 million paid for the 129 room Holiday Inn Express in Palm Desert. Holiday Inn Express Palm Desert San Bernardino County San Bernardino County had a 54.6% increase in sales, from 11 to 17. The total dollar volume rose 108.1%. The average price per room dropped 31.4% and the median price per room decreased 16.5%. The largest and most expensive hotel sold was the 299 room Marriott Ontario Airport (now a Radisson) for $12 million. Radisson Ontario Airport
Northern California Highlights San Francisco County San Francisco County had a 650% increase in individual transactions in 2010, from 2 to 15. The total dollar volume jumped 466.4%. The county s average price per room increased 15.7%, but the median price per room dropped 18.3%. The largest hotel sold was the 417 room Sir Francis Drake Hotel in San Francisco, at $90 million. The most expensive hotel sold was the $143 million paid for the 360 room Le Meridien in San Francisco. Le Meridien San Francisco Sacramento County Sacramento County had a 50% decrease in transactions, from 4 to 2. The total dollar volume dropped 93.8%. The average price per room decreased 86.8% and the median price per room was down 86.5%. The larger and more expensive sale was the $1.7 million paid for the 94 room Travelodge in Rancho Cordova. Travelodge Rancho Cordova Alameda County Transactions in Alameda Clara County increased 66.7%, from 3 to 5. The total dollar volume was up 149.3%. The average price per room rose 11.2%, but the median price per room was down 33.4%. The largest and most expensive sale, at $12.3 million, was the 170 room Sheraton Hotel in Pleasanton. Sheraton Hotel Pleasanton
Recap In reviewing our forecast from the beginning of 2010, we predicted the following: Sales activity will increase dramatically from the 2009 record low; we expect to see 150 175 transactions. We saw a total of 166 sales transactions Dollar volume will also increase, almost double 2009 s number. Dollar volume jumped over 240% Prices will decline 10 20%. The median price per room was down 17.9% in Southern California and down 1.7% in Northern California. The sale of hotel loans will rise substantially. Lenders substantially increased the number of hotel loans sold. This was achieved through a combination of loan pool sales, auctions and individual sales. We estimate that California hotel loan sales increased over 20% in 2010. Lender distress sales will account for over 50% of transactions. The number of hotels sold or taken back by lenders was equal to 47% of the total transactions.
Forecast For 2011, we predict the following: Sales will continue to increase. We expect to see individual hotel sales increase 10 20% or close to 200+ transactions. The median price per room will increase 5 10%. There will be continued strong buy activity on trophy hotels. The larger hotel purchases will be dominated by REITs. Lenders will continue to aggressively sell hotel loans, particularly in secondary and tertiary markets. We will start to see new hotel development in select markets. This will primarily be in the Marriott and Hilton select service brands.
California Sales Survey Year End 2008 California Hotel Sales Comparable Summary Year-End Report -- 2009 vs. 2010 Northern California vs. Southern California Entire California Summary Total 166 92 80.43% $1,787,907,944 $524,992,868 240.56% 15,126 6,040 150.43% Average $10,770,530 $5,706,444 88.74% 91 66 38.79% $82,999 $71,132 16.68% Median $2,402,500 $2,130,000 12.79% 55 46 19.78% $53,613 $56,528-5.16% Transactions Above $5,000,000 Total 54 25 116.00% $1,595,395,680 $408,146,000 290.89% 10,379 3,240 220.34% Average $29,544,364 $16,325,840 80.97% 192 130 48.31% $150,670 $120,287 25.26% Median $12,150,000 $11,150,000 8.97% 157 95 64.74% $112,500 $108,511 3.68% Northern California Summary Total 73 51 43.14% $730,482,444 $289,027,825 152.74% 6,411 2,921 119.48% Average $10,006,609 $5,667,212 76.57% 88 57 53.34% $79,742 $72,524 9.95% Median $2,405,000 $2,100,000 14.52% 60 41 46.34% $52,419 $53,333-1.71% Southern California Summary Total 93 41 126.83% $1,057,425,500 $235,965,043 348.13% 8,715 3,119 179.42% Average $11,370,167 $5,755,245 97.56% 94 76 23.18% $85,555 $69,402 23.28% Median $2,400,000 $2,700,000-11.11% 50 64-21.88% $54,286 $66,096-17.87%
California Sales Survey Year End 2008 California Hotel Sales Comparable Summary Year-End Report -- 2009 vs. 2010 Southern California Counties Los Angeles County Total 27 4 575.00% $405,442,000 $41,100,000 886.48% 2,389 510 368.43% Average $15,016,370 $10,275,000 46.14% 88 128-30.60% $115,168 $52,790 118.16% Median $2,300,000 $3,050,000-24.59% 34 140-75.71% $70,000 $21,446 226.40% Orange County Total 9 8 12.50% $290,950,000 $54,750,000 431.42% 1,383 839 64.84% Average $32,327,778 $6,843,750 372.37% 154 105 46.52% $122,872 $60,624 102.68% Median $3,450,000 $4,250,000-18.82% 108 83 30.91% $57,692 $69,444-16.92% Riverside County Total 14 7 100.00% $23,617,000 $34,491,590-31.53% 409 549-25.50% Average $1,686,929 $4,927,370-65.76% 29 78-62.75% $54,153 $60,076-9.86% Median $700,000 $1,900,000-63.16% 16 63-75.40% $51,955 $66,096-21.39% San Bernardino County Total 17 11 54.55% $50,774,500 $24,396,305 108.12% 1,411 582 142.44% Average $2,986,735 $2,217,846 34.67% 83 53 56.87% $35,586 $51,889-31.42% Median $2,300,000 $2,000,000 15.00% 64 36 77.78% $33,750 $40,404-16.47% San Diego County Total 15 6 150.00% $247,113,000 $50,450,000 389.82% 2,507 408 514.46% Average $16,474,200 $8,408,333 95.93% 167 68 145.78% $100,352 $90,700 10.64% Median $3,000,000 $2,325,000 29.03% 73 53 39.05% $56,250 $64,929-13.37%
California Sales Survey Year End 2008 California Hotel Sales Comparable Summary Year-End Report -- 2009 vs. 2010 Northern California Highlights San Francisco Total 15 2 650.00% $521,342,944 $92,050,000 466.37% 2,330 443 425.96% Average $34,756,196 $46,025,000-24.48% 155 222-29.87% $159,320 $137,668 15.73% Median $11,475,000 $46,025,000-75.07% 117 222-47.18% $112,500 $137,668-18.28% Alameda Total 5 3 66.67% $25,900,000 $10,390,000 149.28% 357 120 197.50% Average $5,180,000 $3,463,333 49.57% 71 40 78.50% $76,544 $68,825 11.22% Median $3,400,000 $5,100,000-33.33% 58 47 23.40% $65,217 $97,963-33.43% Santa Clara Total 4 1 300.00% $58,725,000 $190,000 30807.89% 573 4 14225.00% Average $14,681,250 $190,000 7626.97% 143 4 3481.25% $104,569 $47,500 120.15% Median $12,512,500 $190,000 6485.53% 144 4 3500.00% $93,767 $47,500 97.40% San Mateo Total 1 1 0.00% $0 $2,100,000-100.00% 51 33 54.55% Average $0 $2,100,000-100.00% 51 33 54.55% $0 $63,636-100.00% Median $0 $2,100,000-100.00% 51 33 54.55% $0 $63,636-100.00% Sacramento Total 2 4-50.00% $1,700,000 $27,437,825-93.80% 138 342-59.65% Average $850,000 $6,859,456-87.61% 69 86-19.30% $9,043 $68,610-86.82% Median $850,000 $4,825,000-82.38% 69 79-12.66% $9,043 $66,810-86.47%