By Meghan Hall
A portfolio deal has closed in the Puget Sound that could give insight into how investors are viewing hospitality assets. In five separate deals that closed on September 28th, an investor affiliated with SPI Hospitality has acquired several WoodSpring Suites locations across the region. According to public records, the firm paid a combined $88 million for the assets. The seller was Lehi, Utah-based West77 Partners.
“This portfolio of newly completed, extended-stay properties emulated the best of both a multifamily and a hotel investment by balancing risk, for hoteliers, and driving returns, for multifamily investors,” said CBRE’s Matthew Behrens, first vice president with CBRE.
In the largest of the deals, SPI Hospitality paid $20.328 million for the WoodSpring Suites in Redmond, located at 7045 180th Ave. NE. The buyer paid about $169,400 per key for the asset. The 120-key extended stay hotel originally opened in January of 2020.
In a second transaction, SPI Hospitality acquired the WoodSpring Suites Seattle Tacoma for about $19 million, or $155,737 per room. The asset is located at 11329 Pacific Hwy SW and totals 122 rooms.
In the smallest deal to close, the WoodSpring Suites Southcenter at 15637 West Valley Highway in Tukwila traded for $16.9 million, or about $153,636 per unit. The asset totals 110 rooms and opened just after WoodSpring Suites Redmond, in May of 2020.
SPI Hospitality paid about $31. 8 million for the Woodsprings Suites Vancouver, located at 200 NE 104th, and Woodsprings Suites Richland, located at 1370 Tapteal Drive. The Vancouver property is expected to open in November.
The properties feature on-site guest laundry, fitness center, expanded laundry and other features. The hotels were part of a collaboration between West77 and WoodSprings Hotels to develop 25 different hospitality assets across the state of Washington, according to a statement by the companies.
According to West77 Partners’ website, the firm is currently developing $100 million in real estate assets, and the company focuses on research-driven investments for maximum yield. Its project history also includes the Hilton Garden Inn Seattle Bellevue Downtown, completed in 2018, WoodSpring Suites Seattle Everett, completed in March of 2017, and Washington Square, a 10.5-acre mixed-use project in downtown Bellevue.
We believe strongly in the economy extended stay segment, and we are actively seeking new sites for development in multiple states,” said Mike Nielson, CEO of West77 Partners.
SPI and its investment partner Lennox now own 14 WoodSpring Suites throughout the country as well as interests in another 30+ Extended Stay of America, Candlewood and other properties, according to the firm. The properties recently required have an average occupancy rate of about 90 percent.