The 821-Room Hilton Minneapolis, Minnesota’s Largest Hotel, Trades for $155.5M
- Jun 17, 2010
June 17, 2010
By Barbra Murray, Contributing Editor
Potomac, Md.-based Haberhill L.L.C. and joint venture partner Starwood Capital Group of Greenwich, Conn., have turned a tidy profit with the disposition of the 821-room Hilton Minneapolis in a $155 million deal. The closing of the sale of the Hilton Minneapolis–the largest hotel in the State of Minnesota–to Bethesda, Md.-based DiamondRock Hospitality comes four years after the joint venture partners acquired the property for what now seems like a meager $92 million.
Originally developed in 1992, the Hilton Minneapolis sits downtown at 1001 Marquette Avenue South and is linked to the Minneapolis Convention Center and various coveted area destinations via a skywalk. The joint venture, known as 1001 Marquette L.L.C., renovated the property’s guestrooms and suites in 2007 and 2008, respectively. And in 2009, the partners wrapped up the renovation and expansion of the hotel’s meeting accommodations, increasing the total space from 10,000 square feet to 77,000 square feet.
As per terms of the acquisition agreement, detailed in a DiamondRock SEC document filed upon announcement of the planned Hilton Minneapolis purchase, the price tag on the hotel included the financing of the joint venture’s cost to defease the existing mortgage secured by the property, as DiamondRock would not assume any existing debt.
More than a few hopeful investors took an interest in acquiring the Hilton Minneapolis, which was, as Douglas Greene, Managing Director of Haberhill, told CPE, “discreetly marketed.” A veteran of lodging finance, acquisition, disposition and asset management, Greene takes a matter-of-fact view of the transaction. “We got the right price and it sold.”