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Iconic Fairmont Hotel Trades in Downtown San Jose

Eagle Canyon Capital Completes $250 Million Purchase of 805-Hotel from Maritz, Wolff & Co.
January 4, 2018
Eagle Canyon Capital finalized negotiations a day after the New Year to acquire the 805-room, two-building Fairmont San Jose for a total purchase price of $250 million, or approximately $311,000 per key.

The San Ramon, CA-based outfit led by investor Sam Hirbod had primarily invested in office space before going under contract earlier this year with Maritz, Wolff & Co., a hotel investment group headed by Philip (Flip) Maritz and renown American real estate developer Lew Wolff, to acquire the iconic hotel at 170 S. Market St. in downtown San Jose.

The sale includes only the hotel portion of the property, as the retailers on the ground floor of the 14-story, 264-room annex building are owned by separate entities.

The first luxury hotel to be constructed in Silicon Valley, the Fairmont San Jose delivered in 1987 on a 2.83-acre site overlooking Chavez Park and adjacent to the San Jose Museum of Art. Montgomery Theater, the San Jose McEnery Convention Center, the Tech Museum of Innovation and the campus of San Jose State University are also all within walking distance to the hotel.

Eagle Canyon Capital secured a $173.485 million loan with Colony NorthStar to finance the company's purchase of The Fairmont. At the time of the acquisition, the daily average occupancy was in the mid 80's.

Melvin Chu and John Strauss of JLL brokered the disposition on behalf of Maritz, Wolff & Co. The company, which has dual headquarters in Los Angeles and St. Louis, acquired the hotel in 1996, and in 2002 executed a renovation and expansion that included the development of the annex building.

For more information on Eagle Canyon Capital's acquisition of The Fairmont San Jose, please see CoStar Comp #4098249.
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