MAY 01, 2019|CLARE KENNEDY
Chicago Hotelier Expands Nationwide With Six-Hotel PortfolioMinneapolis, Boston and Salt Lake City Properties Added to Arbor Lodging's Footprint
Arbor Lodging Partners of Chicago has bought six hotels, including this 139-room Hampton Inn at 434 Providence Turnpike in Norwood, Mass. Photo: Hampton Inn Hotel investment and management company Arbor Lodging Partners has closed on a deal to acquire six hotels totaling 815 rooms ranging from California to Massachusetts. Real estate trust Summit Hotel Properties is selling the assets for $135 million, or about $165,000 per door.
The transaction, divulged this month by both companies, gives Arbor Lodging upscale and upper midscale hotel outposts near at least two major tourist attractions, the Mall of America in Bloomington, Minnesota, and the Six Flags Over Texas theme park in Arlington, Texas.
Chicago-based Arbor Lodging said the deal came together off-market, through direct negotiations with Summit, which is headquartered in Austin, Texas.
In a statement, the company said that the portfolio was desirable because of its relative breadth. The hotels in the package are in cities that significantly differ from one another, both economically and geographically, which lowers the company's risk should any one of them fall prey to misfortune, adding that its decision to buy was not influenced by the whims of the market.
"We are 'story investors,' in that we are always focused on the specific details of an investment opportunity [...] versus chasing macro themes and hot markets," reads a statement from Arbor Lodging sent to CoStar. "There are markets we like more than others, and there continue to be tailwinds as demand for hotel rooms is still at record level highs, but we strive to remain disciplined regarding what we pursue."
Vamsi Bonthala, chief executive of Arbor Lodging Partners, described the purchase as a value-add investment, in a statement. Each of Arbor Lodging's new properties are expected to undergo comprehensive renovations, with updates to all the rooms, common areas and meeting spaces.
The properties involved in the deal were:
For its part, Summit said it used the proceeds of the sale to reduce an outstanding balance on its unsecured revolving credit facility and now has $395 million available to borrow.
Summit owns 69 hotels in 24 states, with a total of 10,714 rooms. It did not respond to a request for comment on the latest sale.
Chicago Hotelier Expands Nationwide With Six-Hotel PortfolioMinneapolis, Boston and Salt Lake City Properties Added to Arbor Lodging's Footprint
Arbor Lodging Partners of Chicago has bought six hotels, including this 139-room Hampton Inn at 434 Providence Turnpike in Norwood, Mass. Photo: Hampton Inn Hotel investment and management company Arbor Lodging Partners has closed on a deal to acquire six hotels totaling 815 rooms ranging from California to Massachusetts. Real estate trust Summit Hotel Properties is selling the assets for $135 million, or about $165,000 per door.
The transaction, divulged this month by both companies, gives Arbor Lodging upscale and upper midscale hotel outposts near at least two major tourist attractions, the Mall of America in Bloomington, Minnesota, and the Six Flags Over Texas theme park in Arlington, Texas.
Chicago-based Arbor Lodging said the deal came together off-market, through direct negotiations with Summit, which is headquartered in Austin, Texas.
In a statement, the company said that the portfolio was desirable because of its relative breadth. The hotels in the package are in cities that significantly differ from one another, both economically and geographically, which lowers the company's risk should any one of them fall prey to misfortune, adding that its decision to buy was not influenced by the whims of the market.
"We are 'story investors,' in that we are always focused on the specific details of an investment opportunity [...] versus chasing macro themes and hot markets," reads a statement from Arbor Lodging sent to CoStar. "There are markets we like more than others, and there continue to be tailwinds as demand for hotel rooms is still at record level highs, but we strive to remain disciplined regarding what we pursue."
Vamsi Bonthala, chief executive of Arbor Lodging Partners, described the purchase as a value-add investment, in a statement. Each of Arbor Lodging's new properties are expected to undergo comprehensive renovations, with updates to all the rooms, common areas and meeting spaces.
The properties involved in the deal were:
- a 146-room Hampton Inn & Suites at 2860 Metro Drive in Bloomington, Minnesota, which sits just south of the Minneapolis-St. Paul International Airport and just east of the largest shopping center in the nation, the Mall of America;
- a 113-room SpringHill Suites by Marriott at 2870 Metro Drive in Bloomington, which is on the same block as the Hampton Inn above;
- a 139-room Hampton Inn at 434 Providence Turnpike in Norwood, Massachusetts, a suburb on the southern fringes of the Boston metro area;
- a 101-room Hampton Inn at 5665 Hollister Ave. in Goleta, California, a town that borders Santa Barbara;
- a 189-room Residence Inn at 285 W. Broadway in downtown Salt Lake City, Utah;
- and a 127-room Hyatt Place in Arlington, Texas, at 2380 E. Road, just south of Six Flags Over Texas, one block east of the International Bowling Museum and Hall of Fame, and a short drive to major league baseball team Texas Rangers' ball park and the AT&T Stadium, home of the Dallas Cowboys professional football team.
For its part, Summit said it used the proceeds of the sale to reduce an outstanding balance on its unsecured revolving credit facility and now has $395 million available to borrow.
Summit owns 69 hotels in 24 states, with a total of 10,714 rooms. It did not respond to a request for comment on the latest sale.