Hotel at Symphony Towers Is Sold to Japanese Developer

In another example of increased Japanese interest in San Diego real estate, Marriott Suites at Symphony Towers, the 264-room luxury hotel high-rise that adjoins San Diego’s largest office building, has been sold to a Japanese development company for $41 million.

Dia Pacific, a Honolulu-based subsidiary of Dia Kensetsu, Japan’s third-largest condominium developer, acquired the Marriott Suites at Symphony Towers on Jan. 12, the same day that the 27-story hotel opened for business.

Dia Pacific, which also owns a 440-unit luxury resort on Maui, acquired the hotel from a partnership controlled by London & Edinburgh Trust, a British real estate development and investment firm that bought the financially troubled hotel and neighboring office tower last year.

London & Edinburgh Trust, which is retaining ownership of the neighboring 34-story Symphony Towers office building, will represent the interests of the hotel’s new owners for at least a year, said David Sherwood, London & Edinburgh Trust’s project manager.

“Our intent was to sell the hotel as soon as it opened because we are developers and long-term investors of office buildings,” Sherwood said. “Hotels don’t fit within our long-term objectives.”

London & Edinburgh acquired the 1.1 million-square-foot Symphony Towers project in January 1989 from Guy F. Atkinson Co. of San Francisco, a general contracting firm, just a few months after Atkinson bought the project from Charlton Raynd Development of San Diego. Charlton Raynd became a limited partner with London & Edinburgh when the hotel-office project, at that time still under construction, was purchased from Atkinson.

Construction costs for the hotel and office towers, which occupy a full block bounded by 7th and 8th avenues and A and B streets, have been pegged at more than $140 million. The project surrounds the Symphony Hall, home auditorium of the San Diego Symphony.

London & Edinburgh began looking for long-term investors for the hotel last fall, “discretely marketing” it through Yarmouth Group, a Los Angeles-based real estate investment advisory firm, Sherwood said.

The purchase by Dia Pacific represents “their first acquisition on the mainland that I know of,” Sherwood said. “I think they recognize the quality of the Marriott suites concept and the benefit of having the suites interrelated with the office tower. And they felt downtown San Diego was a very good location for long-term investment purposes. They recognized this as a world class mixed-use asset and were very keen to own part of it.”

Dia Pacific could not be reached for comment.

The hotel, which is now renting the luxury suites at an introductory rate of $109 a night, will continue to be operated by Interstate Hotels under a franchise agreement with Marriott.