Urban Commons , LLC, together with Brighton Management, announced the purchase of the Radisson Plaza in San Jose, with plans to convert to Four Points by Sheraton® San Jose. The property is a full service, 5-story, 196 room hotel situated on 2.75 acres of land, located just one mile east of the Norman Y. Mineta San Jose International Airport and two miles north of downtown San Jose. Known as the "Capital of Silicon Valley", San Jose encompasses over 106 million square feet of office space and is home to some of the world's leading corporations. In the last few years, the city has undergone major redevelopment and revitalizations to the local and downtown areas, and is positioned to further benefit from the expansion of the San Jose McEnery Convention Center, and the development of the new San Francisco 49ers Football Stadium.
The San Jose Airport area does not currently contain any Starwood brand hotels. The closest Starwood product is a small historic building located in downtown San Jose with the Sheraton® Four Points flag. After thorough analysis and feasibility studies, Urban Commons , Brighton and Starwood concurred the Four Points by Sheraton® to be the most successful future brand for this hotel. Renovation plans are now in place worth $5M to update and elevate the hotel up to the Sheraton® brand standards.
This acquisition comes due to the recent foreclosure of the property completed by its lender and adds yet another deeply discounted bank-owned property to Urban Commons ' and Brighton's growing portfolio of hotels. The two companies together jointly pursued the opportunity to purchase this property as it comes at a significant discount to its replacement cost and at an extremely attractive discount to the current market expectations.
The company also purchased the Embassy Suites in Palm Desert. The Embassy Suites is an all-suite full service hotel situated over 9 acres of sprawling desert land in the Coachella Valley area of Southern California. The Coachella Valley is a collection of upscale resort communities located to the east of the Los Angeles-Orange County-San Diego metropolitan area and include the cities of Palm Springs, Cathedral City, Rancho Mirage, and Palm Desert. It is well-known as a home-away-from-home for countless celebrities due to its proximity to the vast Southern California population base.
Urban Commons and Brighton Management have already finalized their negotiations with the Hilton® corporation and have successfully secured a 15 year Franchise Agreement to continue holding the Embassy Suites by Hilton® flag on the property. Renovation plans are now in place worth $6M to update and elevate the hotel up to the Hilton® brand standards.
This acquisition comes due to the recent foreclosure of the property completed by its lender. This adds yet another deeply discounted bank-owned property to both Urban Commons ' and Brighton's growing portfolio of hotels. The two companies together jointly pursued the opportunity to purchase this property as it comes at a significant discount to its replacement cost and at an extremely attractive discount to the current market expectations. In addition, the property comes with an adjacent vacant development site, which could be sold as a separate parcel, used to further expand the hotel grounds and offerings, or possibly developed as future residential.
Since 2007, the Embassy Suites has undergone major renovations. Plans are already in place to infuse another $6 millionworth of improvements and upgrades to further modernize the property. These renovations will allow the hotel to attract the upscale clientele, which traverse the area and closely compete with other local premium hotels.
Urban Commons continues to aggressively grow its portfolio particularly in the hospitality sector. With top management in place, the Company has been able to seamlessly take over hotels and quickly generate value by adding directly to their bottom line. Urban Commons targets distressed and/or bank-owned hotels, where they see the greatest growth potential and upside opportunity for their investors.
Brighton Management currently operates hotels located primarily in the Southern California Counties of Los Angeles, Orange, and Ventura. Recently, Brighton has re-focused on building its portfolio by expanding its reach beyond the Southern Californiaregion. As part of its strategic growth plan, Brighton continues to strengthen its market share by channeling traffic to its surrounding hotels and by having properties available at every price point in the market, resulting in increased revenue growth and net operating income in every segment of the market.
Since 2012, Urban Commons and Brighton Management have completed 13 hotel takeovers totaling over $200 Million in asset value. With their successes in the hospitality sector, the Companies continue an aggressive pace for 2013.
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