The 394-room Hilton La Jolla Torrey Pines has been acquired for $165 million by Los Angeles-based JRK Property Holdings, marking the largest hotel sale in San Diego this year. JRK, which usually focuses on multifamily housing, was attracted to San Diego's strong hospitality market and the Hilton's prime coastal location. Shaan Bhatia, JRK's head of hotel investment, emphasized the hotel's strategic proximity to a robust life sciences corridor and the lack of new hotel supply in the area.
Despite the hotel’s last major renovation being a decade ago, it remains financially successful. JRK plans to invest $30 million in upgrades, focusing on the rooms. The property, located at 10950 N. Torrey Pines Road, sits on city-owned land with a lease that has 63 years remaining.
The acquisition was financed through a combination of equity and loans, taking advantage of favorable terms in the commercial mortgage-backed security market despite high interest rates. This purchase expands JRK's hotel portfolio to 1,500 rooms across various locations, including the Ace Hotel in Palm Springs and the Oceana Santa Monica.
The seller, Braemar Hotels and Resorts, used the sale proceeds to settle its remaining debt for 2024. Although this transaction set a high price, the cost per room was lower than recent comparable sales, due to needed property improvements. Originally owned by Hilton, the hotel was last sold individually in 2003 for $106.5 million.
