China developer buys Sheraton Universal Hotel, California

UNIVERSAL CITY, CALIFORNIA The 451-key Sheraton Universal Hotel, one of the most prominent hotels at the Universal Studios entertainment complex outside Los Angeles, has been acquired by China development firm Shenzhen New World Group Co.

The transaction is expected to close Wednesday. Terms of the deal have not been disclosed. The 20-story property was placed on the market last April, and analysts estimated it could sell for around US$90 million. Owner Lowe Enterprises purchased Sheraton Universal at the peak of the market in 2007 for US$122 million, then spending US$25 million to renovate it.

Shenzhen New World, which acquired the 469-key Los Angeles Marriott Downtown last year, is planning a US$5 million renovation of the Sheraton’s public spaces, The Associated Press reports.

Shenzhen New World was attracted to the Sheraton due to the hotel’s positioning near the popular Universal Studios Hollywood, which the Shenzhen-based developer expects will see a strong recovery as the economy rebounds, says Daniel Teng, a U.S.-based Shenzhen New World executive.

“We think the U.S. economy is going to be improving in a very short time,” he says. “We would like to be at the right place at the right time.” Shenzhen New World is considering other acquisitions in U.S. cities over the next couple years, Teng says.

The Sheraton is managed by Rim Hospitality.