Winston Acquires 697-Room, Five-Property Portfolio

HOUSTON-A five-property portfolio of Marriott hotels and suites, totaling 697 units, has been picked up by a Raleigh, NC-based hotel REIT for less than the list price of $52 million.

Consisting of three locally based hotels, as well as properties in Austin and College Station, TX and Birmingham, AL, the portfolio was acquired by Winston Hotels Inc. The seller was locally based HM Partnership, which was in receivership through Mitchell & Kavallo, PC, also in Houston.

“The partners didn’t agree, so they ended up in court, and the court ruled that the properties should be sold and the proceeds split,” says John Keel, senior vice president with PKF Capital Markets Group in Houston, who brokered the transaction for both the buyer and seller.

The portfolio, which has an average age of five years, attracted many offers from around the country and Keel tells GlobeSt.com that Winston ended up as the buyer, not because it was the highest bidder, but because of its reputation.

“They looked like they could close more quickly, and we knew who they were,” he says, adding that because of the legal issues surrounding the sale, the sellers wanted to know that the investor would make it out of escrow to the final sale.

“We didn’t want to lose a buyer, then have to go back to the judge and start this over again,” Keel says. “We didn’t want to have to go through months of due diligence, then not make it to closing.”

Though the escrow period took months, Keel believes that the wait was worth it for the buyer. All the properties are doing well, he notes. “These are Marriott products, and they’re well-positioned in growth areas,” he adds. “There is a lot of appeal to Texas as a location to out-of-state buyers.”

The portfolio includes the 126-room Courtyard by Marriott, 11050 Louetta Rd.; the 128-suite TownePlace Suites at 11040 Louetta Rd.; the 94-suite TownePlace Suites Clear Lake, 1050 Bay Area Blvd. in Houston; the 94-suite TownePlace Suites at 1300 University Dr. East in College Station/Bryan; the 127-suite TownePlace Suites at 10024 North Capital of Texas Highway North in Austin; and the 128-suite TownePlace Suites at 500 Wildwood Circle in Birmingham, AL.