The buyer, the nation's
By Rick Daysog
second-largest hotel investment trust,
may be seeking other properties
Star-BulletinA Dallas investment company has bought the Park Shore Hotel in Waikiki for $24 million. Patriot American Hospitality Inc., the nation's second largest hotel real estate investment trust, yesterday completed its purchase of the 227-room, leasehold hotel from Japan-based Universal Express (Hawaii) Inc.
The deal is Patriot's first in Hawaii but spokeswoman Susan Cottraux said it may be looking to buy more Hawaii hotels.
"Patriot has a lot of money and they're in a mood to increase their holdings," said Bob Hastings, president of Hastings, Conboy, Braig & Associates, a local real estate appraisal firm.
The Park Shore, located at the corner of Kapahulu and Kalakaua Avenues across from the Honolulu Zoo, sits on leasehold land owned by the Cunha Trust. Patriot said it negotiated a new, 50-year lease with the trust.
Universal Express bought the hotel in 1973 for $5.8 million and added $1.2 million in renovations in 1982, according to a state study.
Cottraux said the company plans to invest $4 million to upgrade the mid-priced hotel into a four-star resort.
Patriot has named NorthCoast-WestCoast Hotels to manage the property in the interim, replacing Aston Hotels & Resorts. Over the longer term, the company said they may bring in Wyndham Hotel Corp. as manager. Patriot is in the process of acquiring Dallas-based Wyndham.
Paul Nussbaum, Patriot's chief executive officer, said the company hopes to take advantage of increased business travelers to Waikiki once the Hawaii Convention Center is open next year.
Patriot owns 65 hotels and resorts, making it the second largest U.S. hotel REIT behind Phoenix-based Starwood Lodging Trust.
The Park Shore sale is the latest sign of increased interest in Waikiki's hotel market, which for years had been largely inactive.
Last month, Japan-based Otake Holdings Inc. acquired the 242-room Aston Waikiki Terrace hotel from Waikiki Plaza Hotel Partners for $22.2 million. Waikiki Plaza had bought the hotel in 1990 for $50 million.
In a 1996 foreclosure auction, Pan Global Partners paid $37.5 million for the 313-room Alana Waikiki Hotel. Pan Global outbid Patriot which offered $37 million.
