Sandhu NW Hospitality LLC sold the Red Lion Inn & Suites in Federal Way to Unshik Che and Miran Che associated with Jabez Enterprises LLC for $8.8 million or $97,778 per room.
Public records show $175,000 was deducted in personal property resulting in a taxable selling price of $8.625 million. Public records also show a breakdown of the cost for the hotel, allocating $1.2 million for the land and $7.425 million for the building itself.
The hotel, located at 1688 S. 348th St., has 90 guestrooms and a conference room.
Paul Sandhu of Sandhu NW Hospitality LLC converted the hotel to a Red Lion Inn & Suites in 2014, according to a Red Lion press release. In the release, Sandhu said, “We are planning to invest $2 million in upgrades to the guest rooms and public space on this property, which will include a new indoor pool with a double water slide.” He also added, “Red Lion Inn & Suites has been a great brand for our properties. We enjoy working with the team and find they offer the right support for our hotels.”
Sandhu has converted other hotels in the state to Red Lion Inn & Suites including a 61-room hotel located at 602 N. Young St. in Kennewick and a 60-room hotel located at 25100 74th Avenue S. in Kent.
A 2016 fourth quarter hotel market report from Kidder Mathews lists the Federal Way market as having a room occupancy of 63 percent in 2016. Other markets such as Renton, SeaTac and Tacoma CBD had projected occupancy rates of 73 percent, 83 percent and 72 percent, respectively. “For 2016, we are estimating market occupancy at 73 percent in Renton and 72 percent in downtown Tacoma. However, these rates may not prove sustainable, as new hotels are under construction in each of these markets.”