Bill Gates’ Investment Group Buys Four Seasons Houston
- Sep 26, 2013
Cascade Investment, of Kirkland, Wash., the private investment arm of billionaire Bill Gates, is set to acquire the Four Seasons Hotel Houston, Cascade announced Wednesday.
The seller is Maritz, Wolff & Co., of St. Louis and Los Angeles, which has owned the hotel since 2000. The transaction is expected to close on Oct. 1.
Financial terms were not disclosed, but Bloomberg reported the sale price to be about $140 million, according to two sources close to the deal.
The Four Seasons Hotel Houston is located at 1300 Lamar St. in the city’s business/financial district and includes 404 rooms and suites and 64 privately owned residential units. (A Four Seasons spokesperson told Commercial Property Executive that a large percentage of the brand’s properties have such private residences.) The property opened in 1982 and is rated at Five Diamonds by AAA.
Under the new owner, the hotel will continue to be managed by Four Seasons Hotels and Resorts, Toronto, which is owned jointly by Cascade Investment, Kingdom Holding Co. and Triples Holdings.
“We have great faith in Houston, particularly with its strong role in the global energy business,” Michael Larson, Cascade Investment’s chief investment officer, said in a press release. “Likewise, because we are very confident in the new executive leadership at Four Seasons Hotels and Resorts and the exceptional in-place management team at this property, along with the enduring value of the Four Seasons brand, we see a compelling real estate investment opportunity here.”
Larson’s mention of Four Seasons’ “new executive leadership” refers to the recent appointment of J. Allen Smith as CEO.
The hotel’s sale is good news, Randy McCaslin, CRE, vice president/practice leader in the Houston office of PKF Consulting USA, told CPE, “because Bill Gates will put the money into the Four Seasons that is needed to bring it back to its grandeur. While others have completed nice renovations in the past, it really needs an update to new Four Seasons standards.”
“Microsoft had a big conference in Houston over the July 4th holiday in 2013, and they are coming back in 2014,” McCaslin added. “This indicates that Houston is being recognized by top companies as an attractive convention market with investment potential. Houston is finally getting the recognition it deserves.”
The average occupancy rate among upper upscale/luxury hotels in downtown Houston was 74.4 percent through August, according to Jones Lang LaSalle. Through August, the ADR average was $168.22, up 5.8 percent, and average RevPAR was $125.10, up 3.2 percent.