Ashford pays $86 million for W hotel at Foshay
The Dallas-based Ashford Hospitality Trust paid $86 million for the W Minneapolis Hotel at the Foshay in downtown Minneapolis, according to a certificate of real estate value made public Friday.
The purchase price works out to $375,546 per room. The deal closed Nov. 10.
The seller was RWB Development Co. LLC in Edina, an entity related to real estate entrepreneur Ralph Burnet.
Ashford, a real estate investment trust, announced in June that it had signed a $101 million agreement to acquire the 229-room W Minneapolis Hotel at the Foshay, at 821 Marquette Ave., and the 60-room Le Meridien, at 901 Hennepin Ave. S. But it did not break out the purchase prices for each building.
Still, in August, RWB closed on the $15 million purchase of Le Meridien, for which RWB paid about $3 million in 2004. This year’s deal worked out to $229,000 per room.
Hennepin County valued the 86-year-old Foshay building – the first skyscraper in Minneapolis — at $29.7 million. RWB paid $15.75 million for the Foshay in September 2006 and proceeded to redevelop it.
Monty Bennett, Ashford’s chairman and CEO, said in June that the Minneapolis market is experiencing strong “RevPAR” growth, a reference to revenue per available room.
“The W Minneapolis is an iconic landmark and both hotels are in excellent physical condition with minimal [capital expenditure] needs. Further, with the expansion of demand drivers, including the highly anticipated addition of the [$1.1 billion Minnesota Vikings] stadium, which is expected to open in 2016, we believe these hotels are well-positioned to achieve further increases in RevPAR,” Bennett said in a prepared statement.
Ashford’s other hotels in Minnesota include the Minnetonka Sheraton and the Hilton-Minneapolis-St. Paul Airport in Bloomington.
On its website, Ashford says its portfolio includes 129 properties with more than 27,000 rooms. The majority of its hotels operate under premium brands owned by Marriott, Hilton, Starwood, Hyatt and Intercontinental.
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