By Meghan Hall
New York City-based hospitality firm Loews Hotels and Resorts has sold off its first Seattle asset as the hospitality market continues to face challenges due to coronavirus. In a deal that closed on June 3rd, Loews sold Hotel 1000 for $55 million, or about $458,333 per room. Public documents indicate that the buyer of the luxury hotel is Los Angeles-based Lighthouse Investments.
The property is located at 1000 First Ave. and totals 120 rooms. Loews Hotels and Resorts originally acquired the property in 2016 from Thayer Lodging Group, a subsidiary of Brookfield Asset Management. At the time, Loews paid $63 million for the asset. At the time, the deal was one of the largest hospitality transactions to close in Seattle’s history with a per-room price of $525,000.
The property also features 6,000 square feet of meeting space, golf simulator, and spa. Loews initially intended to rename the property Loews Regency Seattle after a multi-million dollar renovation of the asset.
“Located near the peaceful Seattle waterfront, Loews Hotel 1000, Seattle features a sleek design showcasing considerate details in each of our 120 luxury Seattle guest rooms,” states the hotel’s website.
The hotel is located at the heart of downtown, near Seattle’s Central Business District and the waterfront. Attractions like Pike Place Market, the Seattle Aquarium and Pier 55 are all located nearby.
However, the property’s location is also within one of the hardest hit submarkets: the urban core. Over the past year, centrally-located hospitality properties have struggled to keep occupancy rates up as both leisure and business travel dwindled. Experts predict that a full recovery won’t occur for another several years.
A recent report released by CBRE indicates that occupancy rates fell 53.2 percent in 2020 to 34.6 percent. Rates have ticked up slightly during the first quarter, reaching 44.2 percent, but are still below pre-pandemic levels.
“We expect hotels and drive-to destination resort areas catering to leisure travelers to continue to see the fastest gains in occupancy,” explained CBRE Executive Vice President Julie Purnell in a statement when the report was initially released. “We anticipate business travel to pick up in the latter half of the year, benefitting urban and suburban upper-priced properties.”
CBRE anticipates that Seattle occupancy rates will reach about 60 percent by 2022 and 71.2 percent in 2023. As vaccinations become more widespread, those in the industry are eagerly looking ahead.