An East Coast firm has snapped up its first hotel in San Antonio: the luxury Hotel Contessa on the River Walk downtown.
A partnership of executives from Silver Ventures and Hixon Properties, local development firms, sold the 265-room hotel last week to Wheelock Street Capital, according to local property and state corporate records.
The purchase price was not disclosed, but the 12-story hotel at 306 W. Market St. was valued at $52.4 million this year by the Bexar Appraisal District.
Wheelock, which has offices in Greenwich, Conn., and Boston, plans to “complete a full renovation of the ground floor restaurant and bar in the coming months,” it said in a news release. The acquisition is the firm’s first hotel purchase since the beginning of the coronavirus pandemic.
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“The property’s historically strong performance, superb location and superior quality in a top leisure-driven market was a perfect match with our current acquisition criteria and provided us the conviction to execute during an uncertain time in the capital markets,” said Tim Hodes, principal and director of hotel investments at Wheelock.
HEI Hotels & Resorts will manage the hotel, which was built in 2005 and includes a rooftop pool and spa.
The pandemic is battering San Antonio’s hospitality industry, and COVID-19 cases in the area are rising. Over 63 percent of downtown hotel rooms, on average, were vacant in October, according to data firm STR, which tracks the sector.
With many conventions, concerts and other events canceled, high-end hotels have been hit particularly hard, said Paul Vaughn, senior vice president at San Antonio-based hotel consulting firm Source Strategies.
In the third quarter, revenue at Hotel Contessa was down about 68 percent from the same period in 2019, he said.
“It’s a tough time to be a luxury hotel,” Vaughn said. “A lot of the higher-end hotels — their revenue is very far down.”