in Rosemont, Illinois, for $125 million, $238,095 per key
DALLAS, Sept. 7, 2006 - Ashford Hospitality Trust, Inc. (NYSE: AHT) announced it has signed a definitive agreement to acquire the 525- room Westin O'Hare in Rosemont, Illinois, for $125 million in cash ($238,095 per key) from JER O'Hare Hotel, LLC, an affiliate of JER Partners. The seller was represented by Molinaro Koger. Westin O'Hare is managed by Starwood Hotels & Resorts Worldwide under a long-term management agreement. The acquisition is expected to close within 70 days.
On a trailing 12-month basis, the purchase price represents a cap rate of 6.5% on net operating income and a 12.9x EBITDA multiple. Ashford will fund the acquisition with proceeds from its July 2006 follow-on offering and property-level debt.
The Westin O'Hare contains 525 rooms, 43,000 square feet of meeting
space and three food and beverage facilities. Opened in 1984, the hotel
completed a $14 million renovation in 2003 that included a complete refurbishment
of the guestrooms, lobby and a majority of the meeting and function space.
Ashford intends to invest an additional $6.1 million over the next 24 months
to further enhance the guestrooms and bathrooms with new improvements such
as soft goods and flat panel TV's. Located on 11.5 acres, the hotel has
space for a potential expansion. The Westin O'Hare is the only four-star,
four-diamond hotel in the O'Hare submarket and boasts the highest meeting
space per guestroom ratio in the market.
Monty Bennett, President and CEO of Ashford Hospitality Trust, said, "Chicago is one of our targeted major markets, and we are pleased to be able to secure what we believe is the best asset in the O'Hare submarket at a price below replacement cost. O'Hare International Airport is one of the world's busiest airports, and the recent approval of a $15 billion expansion should provide further economic stimulus to the local hotel market. The surrounding Rosemont office and industrial submarkets create additional diversified demand generators for the hotel. The Chicago hotel market's recent strengthening and momentum is far from complete with additional gains in RevPAR expected. With its strong brand, excellent competitive location, high ratio of meeting space and potential for future expansion, the Westin O'Hare is poised to benefit greatly from Chicago's improving economic outlook."
Ashford Hospitality Trust is a self-administered real estate investment trust focused on investing in the hospitality industry across all segments and at all levels of the capital structure, including direct hotel investments, first mortgages, mezzanine loans and sale-leaseback transactions. Additional information can be found on the Company's web site at http://www.ahtreit.com.
Certain statements and assumptions in this press release contain or are based upon "forward-looking" information and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
Ashford Hospitality Trust, Inc.
|Also See:||LaSalle Hotel Properties Acquiring the 751 room Westin Michigan Avenue in Chicago, Illinois for $215.0 million / January 2006|
|At $210,000 per Room, The Sale of Controlling Interest in the InterContinental Chicago Makes It One of the Richest Chicago Hotel Deals / February 2005|