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| Embassy Suites by Hilton, Springfield, VA |
WEST PALM
BEACH, FL —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, announced that it has acquired the
219-suite Embassy Suites by Hilton
in Springfield, Virginia for $68 million, or approximately $310,000 per suite.
Chatham funded the purchase through available
cash from its recently completed 5,000,000 share offering that raised
approximately $109 million dollars. With this acquisition, Chatham has invested
approximately 81 percent of the proceeds from the share offering.
“This is a
superior-quality hotel that has been ranked the top hotel within the Embassy
Suites brand each of the last two years,” said Jeffrey H. Fisher, Chatham’s chief executive officer and president.
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| Jeffrey H. Fisher |
“Acquired in an off-market transaction, the
Embassy Suites by Hilton Springfield has the best location among its
competition with superior access to the primary demand generators in a market
where new development is difficult and little new supply is on the horizon.
"It
generates an approximate 10 percent RevPAR premium to our existing properties
while lowering our portfolio’s average age and needs no capex for several
years.”
Opened in
August 2013, the LEED-certified hotel features steel and concrete construction
with a soaring lobby space. In addition to its typical all-suite orientation,
the hotel features 26 additional extended-stay suites with full kitchens.
The company has the opportunity to convert
more suites to this extended-stay-suite format, which gives the hotel the
benefits of achieving higher average room rate and length of stay and a
distinct advantage for long-term extended-stay guests.
“The hotel
is ideally located less than two miles from Fort Belvoir, the nation’s fifth
largest military base and the largest employer in Fairfax County with more than
51,000 military and civilian employees, and the National
Geospatial-Intelligence Agency, which is home to 16,000 employees.
“Additionally,
the Transportation Security Administration recently announced the relocation of
its headquarters with some 4,000 employees to two miles from the hotel by
August 2020, which will further bolster employment and training in the area.
“While demand
is concentrated in government/military business, there is also substantial
corporate demand as Fairfax County has the second-largest concentration of
technology jobs of any major U.S. market and is home to eight Fortune 500
companies such as Booz Allen, Capital One, General Dynamics, Hilton and
Northrup Grumman,” Fisher concluded.
Chatham
estimates it acquired the property at a year one net operating income
capitalization rate of approximately 7½ percent. The hotel will be managed by
Island Hospitality Management, which is 51 percent owned by Fisher.
For more information on this news release,
please contact:
Patrick Daly
Office
Manager
Daly Gray,
Inc.
Office: (703) 435-6293
Cell: (703) 300-8289
or
Dennis
Craven
Chief
Operating Officer
(561)
227-1386
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