Chesapeake Lodging Trust (
completed the acquisition of Hyatt Place New York Midtown South
for $76.2 million. This real estate investment trust (REIT)
bought the property through a definitive agreement with
Hyatt Hotels Corp. (
in late January this year.
Chesapeake Lodging funded the transaction with available cash
resources, a credit at closing equal to the outstanding balance
of a construction loan provided to the seller and a $35.0 million
advance under the company's term loan worth $60 million, which it
took in Jul 2012. Notably, Chesapeake Lodging also penned a deal
with its N.Y.-based property's operator - Real Hospitality Group
- for management of Hyatt Place New York Midtown South hotel.
Strategically positioned at W 36th Street in the central
Manhattan, Hyatt Place Midtown South is a newly developed hotel
having 185 rooms. The property is located in proximity to many
renowned sights and attractions of the city, such as Times
Square, the Empire State Building, Madison Square Garden, the
theaters of Broadway and Radio City Music Hall. The ideal
position of the property makes it conveniently accessible through
major modes of transport.
Hyatt Place Midtown-South is Chesapeake Lodging's first Hyatt
Place-branded property owned in Manhattan. Also, it is Hyatt
Hotels' first Hyatt Place-branded property in N.Y. The
abovementioned hotel acquisition will further strengthen
Chesapeake Lodging's relationship with Hyatt Hotels. Chesapeake
Lodging owns 2 Hyatt-branded hotels - Hyatt Regency Boston and
Hyatt Regency Mission Bay Spa & Marina - in the U.S.
This is an important acquisition for Chesapeake Lodging, given
the strength of the Hyatt Hotels brand and the compelling growth
opportunity of the Manhattan market. The strategic move is
expected to be accretive to the company's long-term earnings and
supplement its portfolio of premium properties.
Chesapeake Lodging owns luxury and upscale hotels in some of the
most desirable locations in the United States. The company
specifically focuses on owning and acquiring hotels at prices
below the replacement cost, with attractive return on investments
and significant upside potential. Currently, the company owns 16
hotels with an aggregate of 4,907 rooms in 7 states and the
District of Columbia.
Chesapeake Lodging currently retains a Zacks Rank #5 (Strong
Sell). REIT's that are performing much better than Chesapeake
Chatham Lodging Trust (
Cousins Properties Inc. (
. Both stocks carry a Zacks Rank #2 (Buy).
CHESAPEAKE LODG (CHSP): Free Stock Analysis
CHATHAM LODGING (CLDT): Free Stock Analysis
COUSIN PROP INC (CUZ): Free Stock Analysis
HYATT HOTELS CP (H): Free Stock Analysis
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