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Chatham Lodging Trust, a hotel real estate investment trust (REIT) focused on investing in premium-branded, select-service hotels, announced that it has acquired the five Innkeepers hotels listed below, which comprise a total of 764 rooms, for a total purchase price of $195 million, or approximately $255,000 per room. The previously announced acquisition nearly doubles Chatham’s existing hotel investments.
“These top-tier branded hotels give us a strong presence in some of the country’s prime hotel markets,” said Jeffrey H. Fisher, Chatham’s chief executive officer and president. “The hotels are in excellent physical condition, with four of the five hotels having been recently renovated, providing a solid foundation for future growth. Based on our previous operating experience with these properties, we know these assets well and expect great results from them.”
Chatham funded the acquisition through the assumption of five individual mortgage loans, secured by the hotels, totaling $134.2 million, as well as available cash and borrowings under its senior secured revolving credit facility. The five loans have a weighted average interest rate of 6.0 percent and mature in 2016. They will amortize based on a 30-year amortization period, other than the loan related to the hotel in Garden Grove, Calif., which will be interest-only for the first two years after closing. The five loans are pre-payable in whole at any time without prepayment premiums or defeasance.
These five hotels will continue to be managed by Island Hospitality Management, a hotel management company that is 90-percent owned by Fisher.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
