In its first venture into the Seattle market, a private REIT has acquired the Seattle Marriott Bellevue, a 17-story, state-of the art hotel that opened in July of 2015. Carey Watermark Investors 2 Incorporated (CWI 2) paid $163.4 million for the newly developed hotel in the Seattle suburb that has evolved into a vibrant independent city as a result of the high-tech boom. The property includes 384 guestrooms and 21,000 square feet of meeting and event space.
CWI 2 is a non-traded real estate investment trust focused on investing in lodging and lodging-related properties. The Seattle purchase made sense, since positive market conditions continue to drive the indsutry. “The opportunity to acquire a recently developed, high-quality urban asset in the Pacific Northwest is a unique opportunity to expand our portfolio into a vibrant growing market,” said Michael Medzigian, CEO of CWI 2 in announcing the purchase. “We believe the hotel’s downtown Bellevue location will position the property to benefit from the strong, technology driven growth fundamentals in the greater Seattle lodging market. The acquisition allows us to invest in an attractive location in one of the fastest growing regions of the country, while providing CWI 2 the opportunity to geographically diversify its portfolio with an acquisition in the Pacific Northwest. Additionally, we are extremely pleased to continue to expand on our already important relationships with both Marriott International and HEI Hotels & Resorts.”
“The opportunity to acquire a recently developed, high-quality urban asset in the Pacific Northwest is a unique opportunity to expand our portfolio into a vibrant growing market”
The hotel has been developed with a highly efficient layout to maximize operational efficiencies in accordance with Marriott’s latest brand standards, including the brand’s newly redesigned guestroom concept, M Club Lounge, and great-room lobby concepts, as well as technologically advanced meeting and event spaces.
The greater Seattle lodging market has seen exponential growth in recent years as a result of its close ties to the high-tech sector, with many major technology employers such as Microsoft, Expedia and Amazon headquartered in the region. As a result of increased corporate office occupancy, fueled by the growing high-tech sector, the Bellevue lodging market has experienced strong growth trajectories over the last several years. Bellevue currently offers 4,284 hotel rooms in 22 lodging properties. From 2009 to 2014, the Bellevue submarket experienced a growth rate of 9.3 percent, outpacing the overall U.S. average growth rate of 6.8 percent. Since November 2015, Bellevue has experienced a growth rate of 8.1 percent.
The Seattle Marriott Bellevue is the only full-service Marriott in the Bellevue market. The hotel will remain under the management of HEI Hotels & Resorts, a hospitality owner and operator that operates 53 full-service, upper-upscale, luxury and premium select-service hotels and resorts throughout the U.S., including eight that are owned by Carey Watermark Investors and CWI 2.
“We believe the buying opportunity for new hotel investments continues,” said Medzigian, “and as with this investment, where we’ve obtained a very high quality, newly constructed asset in a vibrant market, we will continue to execute on similar kinds of opportunities.”