Chatham Lodging Trust Acquires Residence Inn San Diego Downtown-Gaslamp
Chatham Lodging Trust (NYSE:CLDT) , a hotel real estate investment trust (REIT) focused on investing in upscale, extended-stay hotels and premium-branded, select-service hotels, today announced that it has completed the previously announced acquisition of the 240-room Residence Inn San Diego Downtown-Gaslamp Quarter for $90 million, or approximately $375,000 per room.
“Having invested approximately $500 million into new hotel investments in 2014, our outlook on the industry remains bullish, and we expect to continue acquiring hotels in 2015 that meet our strict underwriting criteria,” said Jeffrey H. Fisher, chief executive officer, Chatham Lodging Trust. “The Residence Inn is ideally located in the heart of the Gaslamp Quarter, just a block away from the San Diego Convention Center, one of the most popular convention markets in the country given San Diego’s beautiful year-round climate. This high-quality, downtown, infill hotel in one of the best lodging markets in the country is an ideal addition to our expanding presence in California.”
Opened in 2009, the Residence Inn is within walking distance to the Petco Park and the Westfield Horton shopping complex. The hotel has 1,500 square feet of meeting space and offers the full range of Residence Inn amenities, including free breakfast and complimentary Wi-Fi. The property includes street-level retail space which presently incorporates two leased restaurants that cater to the pedestrian traffic within the popular Gaslamp Quarter. The property also includes a three-level, below-ground, 123-space structured parking garage. These varying sources of income were included in the $90 million purchase price and, including all income, Chatham estimates it acquired the property at a 7.6 percent capitalization rate on 2015 projected net operating income. The hotel represents Chatham’s second San Diego-area hotel, joining the Residence Inn San Diego Mission Valley.
Chatham funded the purchase with available cash from its $120 million share offering that was completed in January 2015. The Residence Inn San Diego Downtown-Gaslamp, previously managed by Marriott International, will be managed by Island Hospitality Management (IHM), which is 51 percent owned by Fisher.
Sajan Hansji, president of J Street Hospitality, stated, “The Residence Inn Gaslamp epitomizes our business strategy of developing and owning tremendously successful properties in unbeatable locations, and we are pleased to sell it to such a well respected owner as Chatham. It has been an important part of J Street’s portfolio, and we look forward to further developing new projects that are equally successful in robust destinations like the Gaslamp Quarter.”
About Chatham Lodging Trust
Chatham Lodging Trust is a self-advised REIT that was organized to invest in upscale extended-stay hotels and premium-branded, select-service hotels. The company owns interests in 131 hotels totaling 18,098 rooms/suites, comprised of 35 properties it wholly owns with an aggregate of 5,355 rooms/suites in 15 states and the District of Columbia and a minority investment in three joint ventures that own 96 hotels with an aggregate of 12,743 rooms/suites. Additional information about Chatham may be found at www.chathamlodgingtrust.com.
About J Street Hospitality, Inc.
J Street Hospitality is a privately held real estate investment and development company based in San Diego, California. The company is focused on owning, developing and renovating hotel properties operating under premier lodging brands located in prime urban and resort locations. J Street Hospitality was formed in 2009, and its current ownership and development portfolio includes nine properties located in coastal California markets. For additional information, see www.jstreethospitality.com.
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 about Chatham Lodging Trust, including statements regarding future plans, strategies, performance, acquisitions, capital expenditures, future operating results and the timing and composition of revenues, among others, and statements containing words such as “expects,” “believes” or “will,” which indicate that those statements are forward-looking. Except for historical information, the matters discussed in this press release are forward-looking statements that are subject to certain risks and uncertainties that could cause the actual results or performance to differ materially from those discussed in such statements. Additional risks are discussed in the company’s filings with the Securities and Exchange Commission.
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