Dealmaker: Seattle Hotel Deca Changes Hands for $55M

LaSalle Hotel Properties, Bethesda, Md., sold Seattle’s Hotel Deca to AJ Capital Partners, Chicago, for $55 million.

The 16-story, 158-room property abuts the University of Washington in Seatle’s University District. AJ Capital Partners said it plans to renovate and re-brand the asset as a Graduate Hotel in late spring 2018.

Currently located in six large university markets across the country including Athens, Ga., Tempe, Ariz. and Madison, Wis, AJ Capital Partners’ Graduate Hotels cater to college students, alumni and their families. AJ plans to open Graduate Hotels in Berkeley, Calif. and Minneapolis later this year.

“Seattle continues to be one of the fastest-growing markets in the country,” said AJ Capital Partners Founder and CEO Ben Weprin. “The hotel is positioned at the nexus of the University of Washington and several Fortune 500 firms.”

LaSalle President and CEO Michael Barnello said the real estate investment trust acquired the hotel in December 2005 for $26.4 million.

“Hotel Deca was an excellent long-term investment for us, generating an unleveraged internal rate of return of 12.3 percent and an average cash-on-cash yield of 8.8 percent over 11 years,” Barnello said.

Barnello said LaSalle will not execute a 1031 exchange in conjunction with the sale but will use sales proceeds for general corporate purposes.