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Chatham Lodging acquires Residence Inn Marriott in downtown Bellevue
Chatham Lodging Trust today announced its purchase of the Residence Inn Marriott building in downtown Bellevue for $71.8 million as part of its West Coast expansion.
The Palm Beach, Fla.-based hotel real estate investment trust states the purchase price represents a forward 12 month capitalization rate of 7.8 percent on the hotel's projected net operating income. The 231-room Residence Inn Marriott in Bellevue was identified as a choice investment due to its being the only extended-stay product in downtown Bellevue.
“We are very excited to acquire one of the highest rated hotels in the Residence Inn by Marriott system, a superior quality property on an urban, infill site in one of the most desirable west coast corporate markets,” said Jeffrey H. Fisher, Chatham’s chief executive officer, in a news release Thursday. “This hotel aligns perfectly with our strategy of acquiring coastal area hotels where demand is driven primarily by corporate travelers focused in the ever-growing technology, energy or medical sectors.”
The hotel is managed by Island Hospitality Management, which is 90 percent owned by Fisher. The purchase was made with cash and borrowings on its Chatham's secured revolving credit facility of $59 million.
"We expect great returns from this hotel," Fisher said in the release. "We have a very active and deep pipeline of prospective targets and intend to use capacity on our balance sheet to acquire hotels that meet our strict underwriting criteria.”