CLT Buys James Royal Palm for $278M

In its 4Q results report released this week, Chesapeake Lodging Trust (CLT) announced that it had entered into a definitive agreement to acquire the 393-room James Royal Palm located in Miami Beach, Florida for a purchase price of $278 million. The acquisition is expected to close in the first quarter 2015, subject to customary closing conditions. The property at 1545 Collins Ave. in Miami Beach is still listed as being owned by RP Hotel Holdings, a company affiliated with Denver-based KSL Capital Partners, according to property records and a report by the South Florida Business Journal.

"We are very excited to announce our entrance into the highly desirable Miami South Beach market with the pending acquisition of The James Royal Palm," said James Francis, Chesapeake Lodging Trust's President and Chief Executive Officer, in a press release. "The Royal Palm, which recently underwent a comprehensive renovation, has an irreplaceable oceanfront location at the intersection of Collins Avenue and 15th Street. We believe the hotel has significant upside potential in both revenue and profitability and we are happy to partner with both HEI Hotels & Resorts, as the new hotel manager, and Starwood Hotels & Resorts, as the franchisor, on this project."

For more news and information visit Blumberg Capital Partners.

Hersha Buys Capitol Hill Suites in DC for $47.5M

Hersha Hospitality Trust announced this month that it had signed a definitive agreement for the purchase of Capitol Hill Suites, an all-suite boutique hotel in Washington, DC, for $47.5 million, or $312 thousand per key excluding closing costs. Hersha assumed a $32.5 million loan with a 5.81% interest rate and cash on hand according to a CoStar report. CoStar also disclosed that Starwood Hotels and Resorts Worldwide had previously sold the Capitol Hill Suites to AEW Capital Management for $38.14 million or $250, 935 per door in January 2007. Hersha's purchase price represents a forward capitalization rate of approximately 7.3% on the hotel’s projected 2011 net operating income, stabilizing at approximately 10%.

Jay H. Shah, Chief Executive Officer of Hersha, said in a statement regarding the decision to purchase, "As a large beneficiary of increased investments in federal and private sector capital outlays, the D.C. region has strong economic and employment fundamentals. The strong real estate fundamentals are equally attractive, with high barriers to entry and negligible planned construction forecasted for several years, combined with growing demand."

For more news and information visit Blumberg Capital Partners.