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DENVER-As part of its previously announced purchase of 38 luxury hotels from Starwood Hotels & Resorts, Host Marriott will be buying the 430-room, Westin Tabor Center in Downtown. Although it is known that the portfolio will cost more than $4 billion, the company did not disclose the amount of the single Denver asset.

However, an analysis of the pending deal shows that Host Marriott will pay an average of $211,453 for each of the 18,964 hotel rooms it is acquiring. If the Westin Tabor Center is purchased for that amount per room, it would equate to a purchase price of about $90.9 million.

“That sounds like a pretty good estimate,” one person familiar with the property tells GlobeSt.com. “I believe that Starwood paid $75 million for the hotel and that price seems in line with what other hotels are selling for.”

But Michael Cahill, president of locally based Hospitality Real Estate Counselors Inc., says he thinks that is a bit on the high side. He notes that the Hotel Monaco, a smaller boutique hotel in Downtown, sold for about $230,000 per key. The Westin, because it is considerably larger, probably would fetch closer to $200,000 per key, he says, which equates to a sale price of about $86 million.

Assuming the deal closes, Host Marriott may place some value on the Westin Tabor Center hotel for tax and accounting purposes, Cahill says. For example, if the company ever sells the hotel, it would need to have a cost basis to determine its gain or (unlikely) its loss. On the other hand, Cahill notes that in large deals such as this, the purchaser may, at some future date, place a sales price value on an individual asset based on a wide variety of factors. The Westin Tabor Center is the 16th largest of the 38 hotels that Host Marriott plans to buy.

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