PITTSBURGH — Forest City Enterprises Inc. announced Friday that it had sold the Sheraton Station Square Hotel on the South Side to a group of investors for $61 million.
The 399-room hotel was sold to Station Square Pittsburgh Hotel LLC, a joint venture led by Pyramid Hotel Group and including an affiliate of Glenmont Capital Management LLC. Pyramid will operate the hotel under a long-term Sheraton franchise agreement with Starwood Hotels.
Forest City said it will receive about $18.5 million in proceeds from the sale.
“We're pleased to complete this transaction with an experienced owner/operator such as Pyramid and their joint venture partners,” said David J. LaRue, president and chief executive officer of Cleveland-based Forest City.
“We continue to execute our strategy of exiting non-core products and markets, and using liquidity from dispositions to further improve our balance sheet, invest in our mature portfolio and activate entitled development opportunities in core markets.”
The Sheraton Station Square Hotel, which has more than 30,000 square feet of indoor meeting space, is located adjacent to Station Square, Forest City's retail/entertainment complex along the Monongahela River. The Plasencia Group represented Forest City in the transaction.
“We are excited to complete this transaction with Forest City and acquire a premier downtown Pittsburgh asset,” said Jim Dina, chief operating officer of Pyramid Hotel Group.
“Pittsburgh is a highly stable lodging market and the Sheraton Station Square offers an unmatched guest experience within the Station Square mixed-use development.
Dina said Pyramid plans renovations to the hotel to deliver a superior level of service for residents and leisure, corporate, and group travelers.
Pyramid Hotel Group is a privately-held, Boston-based hotel company with 54 hotels and resorts under hotel management and asset management, with more than 20,000 rooms and 8,500 employees.
Founded in 2000 by Lawrence A. Kestin, Glenmont Capital Management LLC is a New York-based real estate private equity fund manager focused on real estate investments throughout the United States.
In April, Forest City said it acquired full control of the 12-year-old Mall at Robinson following the purchase of the 28 percent stake that was owned by minority partner Zamagias Properties of Pittsburgh. Forest City also said it also sold its 50 percent interest in the Plaza at Robinson Town Centre to Zamagias. Forest City did not disclose the price of either transaction but said they would result in cash proceeds of $7.75 million.
The moves were part of the company's strategy to focus on large regional malls, such as Robinson, said Forest City has said. It will also focus on its specialty retail centers in the New York City area.
Forest City still is trying to sell Station Square and Liberty Center, Downtown, which is being marketed through Jeff Ackerman, managing director of CBRE Inc. of Pittsburgh.
This article was written by Channel 11’s news exchange partners at TribLIVE.