Wednesday July 16th, 2014 - 9:47AM
DALLAS—Ashford Hospitality Trust, Inc. has signed a definitive agreement to acquire the 357-room Fremont Marriott Silicon Valley hotel. The acquisition is expected to close within the next 30 days. Upon closing, the property will be managed by Remington Lodging.
The company intends to finance the property with approximately $37.5 million of non-recourse mortgage debt.
“We are very excited with this acquisition considering its significant upside potential. As the only full-service hotel in Fremont, the Fremont Marriott is well positioned within the marketplace to draw corporate demand from neighboring companies in Silicon Valley and the surrounding Bay Area,” stated Monty J. Bennett, Ashford Trust’s chairman and CEO. “This hotel offered us an exceptional opportunity. It has a prime location in a high-barrier-to-entry market, and the property recently completed a renovation allowing it to provide best-in-class product quality and services. With the ability to install our affiliated property manager, Remington Lodging, as the new property manager for the hotel, we expect the operating performance of the hotel to improve significantly.”
On a trailing 12 month basis, the Fremont/Newark submarket has seen RevPAR growth of 15.4% through May 2014, according to the company.
The hotel is located directly off Interstate 880 at the gateway to Silicon Valley, near the southern tip of the San Francisco Bay. This location is home to more than 1,200 high-tech, life sciences and clean technology companies.
The hotel features approximately 15,000 sq. ft. of meeting space spread across 19 meeting areas. Originally developed in 1999, it offers an indoor pool and whirlpool, 24-hour fitness center, the Greatroom restaurant and lounge and complimentary on-site parking.
According to the company, the hotel has minimal CapEx needs, having already undergone several renovations, the most recent of which was an approximate $8.1 million ($23,000 per key) renovation and PIP completed in 2013.