Trinity Investments and Oaktree JV Acquire W Hollywood for US$197m
Main Photo: The W Hollywood
Date: December 2021
Name: The W Hollywood
Location: Hollywood Boulevard, Los Angeles, California, USA
Number of Keys: 305 rooms and suites
Seller: Host Hotels & Resorts, that acquired the hotel in 2017 for US$219m. The hotel opened in 2010, developed by Gatehouse Capital and owned in a joint venture by HEI Hotels & Resorts and Gatehouse Capital, in affiliation with the Los Angeles County Metropolitan Transit Authority (Metro).
Buyer: A joint venture among funds managed by Trinity Fund Advisors LLC and funds managed by Oaktree Capital Management, L.P.
A joint venture among funds managed by Trinity Fund Advisors LLC and funds managed by Oaktree Capital Management, L.P. announced the acquisition of a leasehold interest in the W Hollywood, a 305-key luxury hotel located in the heart of Hollywood. Following the transaction, Trinity and Oaktree will undertake a multi-million-dollar capital improvement plan that will both elevate the hotel as well as enhance Marriott International’s design and positioning of the W Hotels brand globally as it evolves to meet the future needs of luxury travelers.
“In acquiring W Hollywood, we are expanding our longstanding partnerships with Oaktree and Marriott International in repositioning a marquee asset in one of the nation’s most storied locations,” said Sean Hehir, Managing Partner, President and CEO of Trinity. “Moreover, this acquisition perfectly aligns with our investment strategy, as we’re able to leverage our significant operational expertise to enhance the property’s appeal and value, like what we achieved with Oaktree and Marriott International at The Westin Maui Resort & Spa, Ka’anapali. We feel that this acquisition reflects our ability to identify compelling hospitality investment opportunities that are poised to deliver attractive risk-adjusted returns.”
Opened in 2010 as the first purpose-built luxury lifestyle hotel in greater Los Angeles, the landmark property is located at the iconic intersection of Hollywood and Vine, benefiting from a diverse array of corporate and leisure demand drivers. W Hollywood features 265 guest rooms and 40 suites, putting guests in the centre of top attractions such as the Hollywood Pantages Theatre, the Hollywood Walk of Fame and the Capitol Records Building. Further, the expansion of “techtainment” and streaming production has materially altered the Hollywood landscape, with Netflix alone leasing nearly 1.6 million square feet of commercial space in the last five years. We believe that the “techtainment” industry will continue to present a significant demand driver for hospitality and entertainment options, thereby positioning W Hollywood for continued success.
“We are excited to acquire the W Hollywood, a landmark property located in the heart of Hollywood, which is undergoing an urban revival driven by the boom in streaming content,” said John Brady, Managing Director and Head of the Global Real Estate group at Oaktree. “We value our partnerships with Trinity and Marriott International, and have confidence in the team’s ability to execute on our collective vision to revive the W Hollywood to a world-class hotel.”
Trinity and Oaktree plan to undertake a comprehensive capital improvement program to completely reposition W Hollywood, enabling this iconic asset to reestablish its prominence as one of the top luxury lifestyle properties in Los Angeles. Plans include fully upgrading all guest rooms – which have not been significantly changed since the hotel opened – and public areas. The partnership will upgrade the property’s food and beverage outlets, pool deck, event spaces, lobby, and arrival experience. A “reimagining” of the hotel’s wellness offerings, including first-class fitness and spa experiences, are also integral parts of the renovation. Moreover, Trinity and Oaktree will leverage their deep institutional knowledge and experience owning and operating luxury lifestyle hotels to explore additional opportunities to maximize value.
“The city of Los Angeles, as well as the W Hotels brand, have dramatically evolved since W Hollywood opened over ten years ago,” said Chris Gabaldon, Senior Vice President, Luxury Brands, Marriott International. “As this evolution continues, we are thrilled to have a visionary partner on board to usher in a new era for this iconic hotel – one which offers global travelers and locals the kind of energy and excitement that only W can deliver in a luxury lifestyle hotel.”
Price: US$197m
Price per Key: $645,902
THPT Comment: An iconic hotel changes hands, at a good price for Trinity and Oaktree…who promise to restore it to more than it’s former glory
First Seen: LA Business Journal
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