BERKELEY — The University of California’s investment arm has bought a big East Bay hotel for well under its appraised value, a deal that hints at lingering ailments in the Bay Area lodging sector.

UC Investments, acting through an affiliate, has paid $175.8 million for the 331-room Residence Inn Berkeley, a Marriott brand hotel, according to documents filed on Oct. 8 with the Alameda County Recorder’s Office.

“This hotel has a very good location in Berkeley,” said Alan Reay, president of Atlas Hospitality Group, which tracks the California lodging market. “Residence Inn is the most profitable brand that Marriott has.”

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The 16-story hotel is at 2121 Center St. near Shattuck Avenue in the lively downtown Berkeley district. It’s also about a block from the UC Berkeley camp

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