St. Regis San Francisco hotel sells to Qatar wealth fund for $175 million

St. Regis San Francisco hotel sells to Qatar wealth fund for $175 million


The Qatar Investment Authority has bought the St. Regis in San Francisco from Marriott International Inc. for $175 million, and will continue to operate under the Marriott brand, Reuters reports.

The iconic 260-room St. Regis, which sits across the street from the newly revamped SFMOMA, had been part of a larger deal Qatar was looking to close in a bid to add to its hotel holdings.

In mid-May it was widely reported that Qatar was in serious talks to buy the St. Regis hotels in New York and San Francisco from Starwood Hotels & Resorts Worldwide Inc., as Starwood attempted to shed assets before being acquired by Marriott International Inc.

Starwood was eventually acquired by Marriott later in the second quarter, after briefly flirting with the idea of a deal with China’s Anbang Insurance Group Co., which walked away from its $14 billion bid.

The country’s sovereign wealth fund has deep coffers and has scooped up $38 billion in real estate since it was founded in 2009. If the report is accurate, Qatar will join a host of Asian and Middle Eastern investors looking to grab prime real estate in the hotel sector, which has seen unprecedented tourism numbers in recent years.

Seoul, South Korea-based Mirae Global Investors bought the Fairmont San Francisco for $450 million in November, the San Francisco Business Times reported that month.

Qatar’s closing of the deal is just its latest chapter of an ongoing U.S. commercial real estate acquisition strategy.

“The wealth fund earlier this year teamed with Douglas Emmett Inc., a real estate investment trust, to purchase four Los Angeles office buildings for $1.34 billion,” Bloomberg reports.“In 2015, Qatar was the second-biggest foreign purchaser of U.S. offices, following its investment in Brookfield Property Partners LP’s $8.6 billion Manhattan West project. The wealth fund and Brookfield also acquired London’s Canary Wharf Group and parent Songbird Estates Plc.”