Sheraton Delfina in Santa Monica sells for $102.8 million

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The Sheraton Delfina Santa Monica Hotel has been acquired for $102.8 million by a Maryland real estate investment trust.

Pebblebrook Hotel Trust said Monday that it bought the upscale, 310-room hotel on Pico Boulevard and will spend another $9 million to refurbish the guest rooms and common areas. The 10-story inn was built in 1972 and expanded in 1984. It was remodeled at a cost of $11 million in 2005.

Pebblebrook bought the property from Regis Properties, an investment group headed by Los Angeles real estate developer and hotelier Brad Korzen. Korzen’s Viceroy Hotel Group will continue to manage the Sheraton Delfina, Pebblebrook said.

Although the hotel industry has suffered in the recession, the Delfina’s price of nearly $333,000 per room was no fire sale, industry consultant Alan Reay of Atlas Hospitality Group said.

“There is very strong buyer demand for good assets in choice locations,” Reay said. “The Sheraton Delfina fits that bill.”

The Westside hotel market is the strongest in the state, he said, with rising occupancy and rooms rates. The Delfina was more than 80% occupied in 2009 at an average daily rate of $179, Pebblebrook said.

-- Roger Vincent