Argosy Real Estate Partners Invests in National Marriott Portfolio
On December 19, 2018, Argosy Real Estate Partners IV, L.P. and its parallel funds, in partnership with PEG Development, acquired a five-property, 617-room, select-service hotel portfolio. The portfolio consists of four Residence Inn by Marriott hotels located in Atlanta, Georgia; Boulder, Colorado; Dallas, Texas; and Philadelphia, Pennsylvania and a Springhill Suites by Marriott hotel located in Fort Worth, Texas. The all-in cost basis for the portfolio represented a significant discount to replacement cost.
The Residence Inn properties have all recently undergone major guestroom and lobby renovations and have demonstrated consistent operating performance due to the strength of the Marriott brand and the desirable infill locations. The Residence Inn properties are 1980’s vintage, “generation one” prototypes, which were designed with numerous individual two-story garden-style buildings with exterior entrances and breezeways to maximize guest privacy during extended stays. The Residence Inn properties have been well-maintained by Marriott and the portfolio is well-positioned to continue strong performance into the future.
The SpringHill Suites was built in 2004 and is a four-story, 144 key select-service hotel featuring primarily 400 square foot executive-style studio suites. The business plan will involve a substantial renovation to upgrade the guest rooms and refresh the hotel’s common areas upon takeover. The renovation of the Springhill Suites will better position the hotel to compete and maintain revenue penetration in the market amidst new supply.
PEG is an experienced Salt Lake City-based hospitality developer and manager, with both residential and hotel development and operations expertise. PEG has developed or managed 28 hotels, 16 of which are Marriott branded, and is currently managing or under construction on 2,700 multifamily units. PEG has in-house construction and general contractor services and plans to manage all major renovations at the hotels.