Argosy Real Estate Partners Exits the Homewood Suites Aliso Viejo

On March 1, 2017, Argosy Real Estate Partners III, L.P. and its parallel funds successfully exited their investment in the Homewood Suites Aliso Viejo, a four-story, 129-room hotel located in Aliso Viejo, California (Orange County).  The property was sold to a publicly-traded hotel REIT.  A strong sales price was achieved as a result of the appealing Hilton brand affiliation, high barriers to entry in the local market, and limited supply pipeline.

In August 2014, AREP III partnered with Stonebridge Companies to develop the property.  The hotel is located on a 2.6-acre site within a 39-acre mixed-use community containing office and residential uses in the city center of Aliso Viejo.  The land for the project was purchased directly from the master developer with entitlements, building permits, financing and a GMP construction contract in place.

The property opened in February 2016, ramped up quickly and immediately began outperforming budget.  Given the hotel’s strong performance and high investor demand for premium extended-stay product in Southern California, the Fund elected to pursue a sale of the property.