FREMONT — A hotel in Fremont has been bought by a big investor that also has grabbed a hotel in San Francisco, fresh evidence that Bay Area lodgings still command buying interest despite coronavirus-spawned uncertainties.
Hilton Garden Inn Fremont Milpitas has been bought for $38.9 million by an affiliate of AWH Partners, according to documents filed on Sept. 10 with the Alameda County Recorder’s Office.
Separately, on Sept. 9, an alliance of AWH Partners and The Roxborough Group paid $87.5 million for Villa Florence Hotel, a 189-room lodging in San Francisco.
In the Fremont hotel deal, the seller was a venture headed by Vinobhai Patel and Neil Patel, a group that had developed the hotel. The hotel’s construction was completed earlier this year.
The purchase of Hilton Garden Inn Fremont Milpitas suggests that property buyers envision an upside in key hotel sites once the economic woes linked to the deadly bug have begun to recede.
“Buyers that are purchasing these assets today are really looking at the long-term picture,” said Alan Reay, president of Atlas Hospitality Group, which tracks the California Lodging Market. “The buyer understands that with a brand-new hotel like this, they don’t have to put a lot of money back into the property.”
New York City-based AWH Partners, acting through its affiliate FO Fremont Property, bought the hotel in an all-cash deal, the county records show.
The hotel totals 145 rooms, according to a representative of the lodging, which is located at 45976 Warm Springs Blvd. in Fremont.
“Amenities include a fitness center, business center, and an indoor pool,” AWH stated in a post on its website that described the Hilton Garden Inn Fremont. “An on-site restaurant and bar and a 24-hour grab-n-go market” are also part of the amenities, the company said on its site.
The buyers were likely enticed by the Hilton Garden Inn Fremont’s category and typical market, in Reay’s view.
“The product type of this hotel is the kind of product that is coming back faster after COVID than the major full-service hotels,” Reay said. “This hotel typically has a much better profit margin than the really big hotels. It’s a very good model and is very successful.”
Plus, the hotel’s location in one of Silicon Valley’s cities was also likely a big draw for the buyer. The hotel is located in the “Fremont Innovation District,” according to a post on the AWH Partners website.
“Silicon Valley is probably in the top three or five of the commercial business travel centers,” Reay said. “It’s supply and demand. There’s a lot of buyer interest out there right now in hotels.”