UC investment unit buys big East Bay hotel for more than $170 million

"Residence Inn Berkeley, a Marriott-branded hotel at 2121 Center Street in downtown Berkeley, seen in March 2025. (Google Maps) This hotel has a very good location in Berkeley, said Alan Reay, president of Atlas Hospitality Group, which tracks the California lodging market. Residence Inn is the most profitable brand that Marriott has. The 16-story hotel is at 2121 Center St. near Shattuck Avenue in the lively downtown Berkeley district. It's also about a block from the UC Berkeley campus."

"The UC Investments affiliate bought the 16-story Residence Inn Berkeley through an all-cash deal, the county documents show. In 2023, the hotel was appraised at $218 million in connection with a $120 million financing package the hotel received at that time, according to a report produced by MSCI Real Capital Analytics. The hotel also had previously received $50 million in C-PACE financing for an energy-efficient structure."

"This means the price UC Investments paid was 19.4% less than the appraised value of the hotel. UC Investments got a very good deal for this hotel, Reay said. The price worked out to roughly $531,100 a room. Reay estimated the expense to build an equivalent hotel from scratch today, a metric also known as the replacement cost, would be in the range"

UC Investments paid $175.8 million for the 331-room Residence Inn Berkeley. The purchase was recorded Oct. 8 with the Alameda County Recorder's Office and was executed as an all-cash deal by a UC Investments affiliate. The 16-story Marriott-branded Residence Inn at 2121 Center St. sits near Shattuck Avenue in downtown Berkeley, about a block from the UC Berkeley campus. The Bay Area lodging market shows fading values, defaults and foreclosures that have chilled hotel development across California. The hotel was appraised at $218 million in 2023 tied to a $120 million financing package and had previously received $50 million in C-PACE financing. The sale price was about 19.4% below appraisal, equating to roughly $531,100 per room.

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