Braemar Hotels Resorts Sells The Clancy Hotel in San Francisco for $115 Million

What's Happening?

Braemar Hotels & Resorts Inc. has entered into a definitive agreement to sell The Clancy, a 410-room hotel located in San Francisco, for $115 million. The sale price translates to approximately $280,487 per room. The transaction is expected to close in November 2025, subject to customary conditions. As part of the agreement, Braemar has received a non-refundable earnest money deposit of $3.5 million. The sale is part of Braemar's strategy to refine its portfolio, with the transaction based on a 5.0% capitalization rate applied to the hotel's net operating income for the 12 months ending in August 2025. The agreement includes a provision for the buyer to extend the closing date by 30 days, requiring an additional $1 million non-refundable deposit if exercised.

Why It's Important?

The sale of The Clancy is significant as it reflects Braemar Hotels & Resorts' strategic efforts to optimize its asset portfolio. By divesting this property, Braemar aims to streamline its holdings and potentially reallocate resources to other investments or opportunities. The transaction also highlights the ongoing interest and investment in the San Francisco hotel market, which remains a key area for hospitality and real estate investors. The capitalization rate of 5.0% indicates a strong performance of the asset, suggesting that the hotel has been a profitable venture for Braemar. This move could influence other hotel operators and investors to consider similar strategies in asset management and portfolio optimization.

What's Next?

The transaction is set to close in November 2025, pending customary conditions. If the buyer chooses to extend the closing date, they will need to provide an additional $1 million non-refundable deposit. Braemar has not disclosed further details on how this sale will impact its broader strategic objectives or future transactions. However, the company may continue to evaluate its portfolio for additional opportunities to optimize its assets. The outcome of this sale could also prompt other hotel operators to reassess their portfolios and consider similar divestitures or acquisitions.