UNITED STATES - The Rockpoint Group has completed its first acquisition in the United States in 18 months, with the $10m (€6.93m) deal to purchase the 434-room Newton Marriott Hotel in Massachusetts.

Officials at the investment management firms - which also manages investments on behalf of pension funds - believe the time is right to be investing in hotels as there is currently little capital in the market seen to be interested in buying hotels.

The hotel market is presently struggling but it is anticipated that it will improve pretty quickly once the economy starts to improve and more hotel rooms begin to refill with customers.

Rockpoint is intending to make improvements to the property and manage the property affectively, in a bid to heighten its performance over the next three to five years, such as the inclusion of wi-fi capability and new high definition televisions in every room.

The property typically attracts people on business in Boston or families with college students in the Boston area.

Rockpoint bought the property - first developed in 1969 - from Host Marriott - to sit within its commingled Fund III. However, the last purchase it made was in January 2008.

Rockpoint raised a total of $2.5bn through the fund by April 2008 but it is understood just 15% of the equity has so far been invested.

Among its investors was Oregon Public Employees Retirement Fund as it made a $150m commitment to the fund in 2007.  By March this year, the pension fund had only committed $19.1m worth of capital to the fund and the fair market value of its investment was $8.6m.

Long-term, Rockpoint predicts approximately 60% of the fund's assets will be held in the US as the rest of the portfolio will be located in Japan,  the UK and Germany.

Topics