SAN CLEMENTE, Calif., April 13, 1998 - Sunstone Hotel Investors, Inc. (NYSE: SSI), a real estate investment trust (REIT), today announced that the Company has closed the acquisition of the Hilton Inn, located in Oxnard, California.
Sunstone purchased the 160-room Hilton Inn from Westbrook Partners for approximately $9.3 million. The hotel is located approximately one mile from the Company's Residence Inn in Oxnard. The property consists of one six-story building and two 2-story buildings which include meeting rooms, a restaurant and lounge, a beauty salon and barber shop, a gift shop, a tennis court and fitness track and a swimming pool and spa. Reported occupancy and average daily room rate (ADR) for the hotel for the twelve months ended December 31, 1997 were 57.5% and $70.98, respectively. The Company believes significant opportunities exist to grow occupancy and ADR after the hotel is fully renovated.
Commenting on this acquisition, Robert A. Alter, President and Chief Executive Officer, said, "Our acquisition strategy remains on track. Specifically, we expect to create more value for shareholders through this acquisition by improving the operations of the Hilton Inn to its full potential. This acquisition will give Sunstone increased market penetration in the strong Oxnard/Ventura hotel market. In addition to this hotel, we expect to close on an additional four properties within the next 45 days."
The Hilton Inn is located next to the Interstate 101 (Ventura Freeway) between Santa Monica and Santa Barbara. Major attractions are the Oxnard State Beach, Channel Islands Harbor, Ventura Harbor, Anacapa Islands, Oxnard and Camarillo Outlet Shopping, Port Hueneme Museum and Ventura County Maritime Museum. Port Hueneme and Port Mugu are on the outskirts of Oxnard. The largest employers in the Oxnard area are the U.S. Navy, HAAS Automation, Procter Gamble and GTE.
The Company currently has, under letter of intent, four hotels with a total of 648 rooms at a purchase price of approximately $71 million. The Company anticipates closing on these hotels within the next 45 days.
Sunstone Hotel Investors, Inc. is a leading self-administered equity real estate investment trust that owns full service, upscale and mid-price hotels located in the western United States. The Company's growth strategy is to maximize shareholder value by (i) acquiring underperforming hotels within the western United States that are in attractive locations with significant barriers to entry and (ii) improving such hotels' financial performance by renovating, redeveloping, rebranding and repositioning the hotels together with the implementation of focused sales and marketing programs. Sunstone Hotel Investors, Inc., the only hotel REIT that currently focuses its acquisition strategy in the western United States, owns, through Sunstone Hotel Investors, L.P., 58 hotels (including the aforementioned acquisition) comprising 10,515 rooms. Sunstone's business strategy is to own full service, upscale and mid-price hotels with revenue growth opportunities in strong western U.S. markets.
Statements in this press release which are not strictly historical are "forward-looking" and are subject to the many risks and uncertainties which affect Sunstone's business, and could cause actual results to differ materially from those projected and forecasted. These uncertainties, which include competition within the lodging industry, the balance between supply and demand for hotel rooms, the Company's continued ability to execute acquisitions and renovations, the effect of economic conditions, and the availability of capital to finance planned growth, are described but are not limited to those disclosed in the Company's annual report on Form 10-K for the year ended December 31, 1997, as filed with the Securities and Exchange Commission.