Argosy Exits Mill Valley Hotel

On July 2, 2015, Argosy Real Estate Partners II, L.P. successfully exited its investment in the 100-room Holiday Inn Express in Mill Valley, California. The hotel was sold to a regional hotel owner/operator. The property includes 1,440 square feet of meeting space and a 6,000 square foot restaurant space, which is currently leased to a third-party operator through 2020. The property is located along Highway 101 in the city of Mill Valley in southern Marin County, approximately five miles from the northern terminus of the Golden Gate Bridge and 11 miles from downtown San Francisco.

The Mill Valley Hotel was acquired by a partnership formed with Ultima Hospitality, a vertically integrated hotel owner and manager based in Chicago. Ultima’s portfolio of owned and managed properties currently includes ten hotels nationwide with 2,491 rooms, concentrated in the Hilton, Marriott, Starwood, and IHG brand families. Ultima also provides third-party management services. Ultima is affiliated with Waterton Associates, a major owner/operator in the multifamily sector, allowing Ultima to draw on the deep back office support and financial resources of its much larger parent company.

The Property was acquired in August 2012 and during the hold period, the partnership successfully repositioned the asset by re-branding as a Holiday Inn Express, completed the associated property improvement plan, and remediated structural issues affecting a portion of the property. Ultima also put in place an excellent management team at the hotel and provided close support from the corporate office, which provided critical support for execution of the repositioning and drove strong operating performance upon stabilization. The property has been stabilized since mid-2013. Since that time, the property has generated operating results well above pro forma, posting positive trends in top-line performance versus competitive properties while also benefiting from the broad strength of the wider San Francisco hotel market over the past several years.