BETHESDA, Md.—LaSalle Hotel Properties has acquired Hotel Vitale in San Francisco, Calif., for $130 million. The company funded the acquisition with borrowings from its senior unsecured credit facility.
The 200-room hotel is located at the intersection of the Embarcadero Waterfront and the Financial District, across from the historic Ferry Building Marketplace. There is 21 million square feet of existing office space and 3.5 million square feet of new office development within six blocks of the hotel. Some of San Francisco’s most notable companies surround the hotel, including Salesforce, Google, Gap, and PG&E. Hotel Vitale is also proximate to retail and entertainment attractions, such as Steuart Street’s restaurant row, Moscone Center, AT&T Park, and Union Square.
“We are thrilled with this acquisition,” said Michael D. Barnello, president and chief executive officer of LaSalle Hotel Properties. “Hotel Vitale is outstanding physically and in terms of its location. The hotel is surrounded by demand generators that attract corporate and leisure business and the views from the hotel are breathtaking.
“We are also excited about increasing our presence in San Francisco. Room demand is at peak levels and supply growth is expected to be limited for the next several years, which bodes well for owners and operators. Market performance has been strong and we are pleased to have acquired our sixth hotel in San Francisco.”
Newly constructed in 2005, the hotel has been well maintained with $6.5 million in subsequent capital expenditures including restaurant upgrades and new guestroom furniture. Hotel Vitale’s 200 guestrooms average 375 square feet and include eight suites.
Americano Restaurant and Bar, the hotel’s signature dining outlet, features a modern design and is comprised of a cocktail lounge, indoor dining area with 180-degree panoramic views, 18-seat private dining room, and 3,000-square-foot outdoor patio overlooking the Embarcadero and San Francisco Bay. The property offers 11,300 square feet of meeting and event space, including several outdoor spaces.
The hotel was purchased subject to a ground lease with the City and County of San Francisco, Municipal Transportation Agency, which expires on March 8, 2070. Hotel Vitale is managed by Commune Hotels and Resorts, which also manages the Company’s Gild Hall hotel in New York.