Bethesda, Maryland-based real estate investment trust (REIT)
RLJ Lodging Trust (
recently opened its seventh property - Hotel Indigo New Orleans
Garden District - after an extensive brand conversion in
Louisiana. The move was in line with the company's planned
capital strengthening program.
RLJ Lodging has been largely focusing on upgrading and
repositioning 24 hotels that it acquired in 2010 and 2011. Among
these, seven hotel brand conversions were slated to be completed
by 2012. Hotel Indigo New Orleans, which marked the seventh and
the final property, is now open for business. The previously
converted properties include Hilton Garden Inn Pittsburgh
University Place, Hilton Garden Inn Durham and Embassy Suites
West Palm Beach-Central.
RLJ Lodging acquired the distressed independent hotel in 2010 for
$6.4 million. Subsequent to a comprehensive renovation worth
$16.9 million, the company reopened the property under the Hotel
Indigo brand. Hotel Indigo is an upscale boutique brand of
Intercontinental Hotels Group plc (
Post-renovation Hotel Indigo New Orleans Garden District
comprises 132 rooms. Positioned in the historic Garden District
along the St. Charles Avenue Streetcar Line, the hotel is
conveniently connected to renowned business and leisure
attractions of New Orleans - such as the French Quarter, Tulane
and Loyola University and Babin's Bar & Bistro.
New Orleans, the largest city and metropolitan area of Louisiana,
is among the top 10 most visited cities in the U.S. The city
boasts a variety of tourist attractions, which acts as a major
catalyst for growth of the economy. The city was also among the
major victims of Hurricane Katrina in 2005. However, the city
continues to show strong recovery and has been experiencing a
robust population and tourism growth in the recent years.
According to the New Orleans Convention & Visitors Bureau
('CVB'), this city welcomed around 4.9 million visitors in the
first half of 2012 - a 2% increase over the same period in 2011.
The organization expects New Orleans to host around 13.7 million
visitors by 2018. Moreover, the RevPAR (Revenue Per Available
Room) in New Orleans has increased 15.9% year-to-date through
November 2012, according to Smith Travel Research, Inc. The
increase surpassed the figures of some high revenue generating
markets such as San Francisco, Los Angeles, and Boston.
The abovementioned fact justifies the RLJ Lodging's decision of
choosing the city of New Orleans. Management also expects the
Hotel Indigo brands' popularity to benefit the new property going
Currently, RLJ Lodging has been highly active on the acquisition
front in key gateway markets of the U.S. like Washington DC, New
York City and others. In the last two months, RLJ Lodging debuted
in the Greater Boston market and Miami with the acquisition of
Embassy Suites in Waltham and Hilton Cabana Miami Beach,
RLJ Lodging carries a Zacks #2 Rank (short-term Buy rating). One
of its peers,
Franklin Street Properties Corp. (
, holds a Zacks #1 Rank (Strong Buy).
FRANKLIN ST PPT (FSP): Free Stock Analysis
INTERCONTL HTLS (IHG): Free Stock Analysis
RLJ LODGING TR (RLJ): Free Stock Analysis
To read this article on Zacks.com click here.