REPORT FROM THE U.S.—The Cerberus Capital Management L.P./Chatham Lodging Trust joint venture isn’t wasting time putting some of the hotels it acquired from Innkeepers USA Trust on the block.
After initially walking away from a proposed US$1.13-billion deal in August when the capital markets collapsed, the New York-based private-equity firm Cerebrus and the Palm Beach, Florida-based Chatham paid US$1.02 billion in October to acquire a portfolio of 64 hotels from Innkeepers.
Acting as broker for the sale, CBRE Hotel Group announced 16 November that 11 of the properties are being marketed for sale.
In an emailed statement, Chatham CFO Dennis Craven said: “When the joint venture was doing its initial analysis of the portfolio, we identified 11 non-core hotels of which eight were unbranded. They were good hotels in good locations but are not consistent with the joint venture’s strategy of owning premium-branded hotels. Furthermore, there is substantial demand for these hotels, in part, because financing is readily available, including (Small Business Administration) loans.
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He added, “Divesting these hotels will allow us to focus our full attention on those strategic assets that we believe will yield the highest returns.”
The portfolio, which comprises 1,246 rooms, includes current and former Hampton Inn and former Residence Inn properties. Nine of the former Hampton Inns and Residence Inns operate under the Stay Inn and Guesthouse Suites names, respectively. Three of the properties will retain the Hampton Inn brand.
The hotels up for sale are:
• Gatehouse Suites, East Lansing, Michigan (60 rooms)
• Gatehouse Suites, Fort Wayne, Indiana (80 rooms)
• Gatehouse Suites, Grand Rapids, Michigan (96 rooms)
• Gatehouse Suites, Indianapolis (88 rooms)
• Hampton Inn, Westchester, Illinois (112 rooms)
• Hampton Inn, Woburn, Massachusetts (98 rooms)
• Stay Inn, Lombard, Illinois (128 rooms)
• Stay Inn, Schamburg, Illinois (128 rooms)
• Stay Inn, Cohoes, New York (126 rooms)
• Gatehouse Suites, Troy, Michigan (152 rooms)
• Hampton Inn, Germantown, Maryland (178 rooms)
In a statement, CBRE said it has had “discussions” with investors who might be interested in picking up the hotels. CBRE officials did not return a request for comment.
Contact:
Chatham Lodging Trust
Phone: (561) 802-4477
Email: info@cl-trust.com