“We’ve owned this asset for a number of years,” he said in an interview yesterday following a media tour of Barker Block, a Los Angeles condominium development partly owned by New York-based Blackstone. “We’ve invested in it, it’s performing well,” Gray said of the hotel, which Blackstone spent $50 million to renovate.
The London West Hollywood, located just off Sunset Boulevard and featuring a Gordon Ramsay restaurant, is part of Blackstone’s LXR Luxury Resorts & Hotels unit. Blackstone sold another LXR property, Golden Door Spa in Escondido, California, for $24.8 million in December. Other resorts in the portfolio include El Conquistador Resort in Puerto Rico and the Casa Marina resort in Key West, Florida, according to data compiled by Bloomberg.
“We believed in the lodging recovery during the downturn and we continue to believe in the lodging recovery and always look for opportunities to invest,” Gray said. “Lodging went through a pretty sharp downturn and a number of assets got into financial trouble. That created opportunities to buy hotels.”
Hotels in the city of West Hollywood had an average occupancy of 79 percent and revenue per available room, an industry measure of occupancies and rates, of $186.86 last year, according to Hendersonville, Tennessee-based research firm STR. Both figures were the highest since at least 2006.
Blackstone hired brokerage Eastdil Secured to help sell the London West Hollywood, Gray said. He declined to disclose the expected listing price for the property. A night at the hotel, which has a rooftop pool, starts at $449 for the week of April 29, according to the property’s website.
As Blackstone continues to look for lodging investments, the firm favors markets with few new hotels, such as Hawaii, Gray said. Blackstone agreed to buy the leasehold on the Hyatt Regency Waikiki Beach Resort and Spa for $450 million and plans to remodel the property, which includes a shopping mall, a person with knowledge of the transaction said two days ago.
“Some places are becoming a little more challenging, like New York City, because there is more new supply relative to, say, Oahu or San Francisco, where supply is relatively limited,” Gray said yesterday.
Blackstone is the largest private-equity investor in real estate, with $59.5 billion in property assets under management. Last month, Blackstone sold the Miami Beach Resort in Florida to Joseph Chetrit for $117 million.
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