Chatham Lodging Trust and Cerberus Capital Management said Thursday that they have completed their buy of 64 hotels of Innkeepers USA Trust. The total gross purchase price was about $1.02 billion. Cerberus/Chatham were locked in a bitter dispute with Innskeeper USA Trust for two months after backing out of a deal to buy the hotels at a higher price.
PRESS RELEASE
Chatham Lodging Trust (NYSE: CLDT), a hotel real estate investment trust (REIT) focused on investing in premium-branded, select-service hotels, and affiliates of Cerberus Capital Management, L.P., a private investment firm, today announced that they have completed the acquisition of 64 hotels from affiliates of Innkeepers USA Trust.
The joint venture between Cerberus and Chatham acquired the 64 hotels, aggregating 8,329 rooms, for a total gross purchase price of approximately $1.02 billion, including the assumption of approximately $675 million of mortgage debt on 45 of the hotels with a weighted average interest rate of 6.71 percent and maturing in 2017. The other 19 hotels are unencumbered. The purchase price per room, net of cash reserves, was approximately $118,000 per room/suite.
Chatham owns an approximate 10.3 percent interest in the joint venture and funded its $37 million investment in the joint venture with borrowings under its senior secured revolving credit facility. Chatham will provide certain asset management services to the joint venture and will receive a promote interest based on meeting certain return thresholds. All costs of operating the joint venture will be paid by the joint venture.
All but one of the 64 acquired hotels will continue to be managed by Island Hospitality Management, a hotel management company that is 90 percent owned by Jeffrey H. Fisher, Chatham’s chief executive officer and president.
About Chatham Lodging Trust
Chatham Lodging Trust is a self-advised REIT that was organized to invest in upscale extended-stay hotels and premium-branded, select-service hotels. The company currently owns 18 hotels with an aggregate of 2,414 rooms/suites in 10 states and the District of Columbia, holds a minority investment in a joint venture that owns 64 hotels with 8,329 rooms/suites and has one additional hotel comprising 174 rooms/suites under contract to purchase. Additional information about Chatham may be found at www.chathamlodgingtrust.com.
Forward-Looking Statement Safe Harbor
Note: This press release contains forward-looking statements within the meaning of federal securities regulations. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “should,” “plan,” “predict,” “project,” “will,” “continue” and other similar terms and phrases, including references to assumption and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010, and include, but are not limited to: national and local economic and business conditions, including the effect on travel of potential terrorist attacks, that will affect occupancy rates at the company’s hotels and the demand for hotel products and services; operating risks associated with the hotel business; risks associated with the level of the company’s indebtedness and its ability to meet covenants in its debt agreements; relationships with property managers; the company’s ability to maintain its properties in a first-class manner, including meeting capital expenditure requirements; the company’s ability to compete effectively in areas such as access, location, quality of accommodations and room rate structures; changes in travel patterns, taxes and government regulations which influence or determine wages, prices, construction procedures and costs; the company’s ability to complete acquisitions and dispositions; and the company’s ability to continue to satisfy complex rules in order for the company to remain a REIT for federal income tax purposes and other risks and uncertainties associated with the company’s business described in the company’s filings with the SEC. Although the company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. All information in this release is as of October 27, 2011, and the company undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in the company’s expectations.
Fact Sheet
Hotels Acquired by Cerberus-Chatham Lodging Trust Joint Venture
# Hotel Location State
Rooms
1 Boston Bulfinch Boston MA 79
2 Courtyard by Marriott Ft. Lauderdale FL 136
3 Courtyard by Marriott Atlantic City NJ 206
4 Courtyard by Marriott Montvale NJ 184
5 Embassy Suites Santa Clarita CA 156
6 Gatehouse Suites Indianapolis IN 88
7 Gatehouse Suites East Lansing MI 60
8 Gatehouse Suites Grand Rapids MI 96
9 Gatehouse Suites Troy MI 152
10 Hampton Inn Naples FL 107
11 Hampton Inn Westchester IL 112
12 Hampton Inn Louisville KY 173
13 Hampton Inn Woburn MA 99
14 Hampton Inn Columbia MD 83
15 Hampton Inn Germantown MD 178
16 Hampton Inn Islandia NY 120
17 Hampton Inn Willow Grove PA 150
18 Hyatt Summerfield Suites Belmont (Silicon Valley) CA 132
19 Hyatt Summerfield Suites El Segundo CA 122
20 Hyatt Summerfield Suites Mt. Laurel NJ 116
21 Hyatt Summerfield Suites Dallas (Addison ) TX 132
22 Hyatt Summerfield Suites Dallas (Las Colinas) TX 148
23 Residence Inn by Marriott Fremont (Silicon Valley) CA 80
24 Residence Inn by Marriott Mountain View (Silicon Valley) CA 112
25 Residence Inn by Marriott Ontario CA 200
26 Residence Inn by Marriott San Jose (Silicon Valley) CA 80
27 Residence Inn by Marriott San Jose (Silicon Valley) CA 150
28 Residence Inn by Marriott San Mateo (Silicon Valley) CA 160
29 Residence Inn by Marriott Sunnyvale (Silicon Valley) CA 231
30 Residence Inn by Marriott Sunnyvale (Silicon Valley) CA 247
31 Residence Inn by Marriott Denver CO 159
32 Residence Inn by Marriott Denver (Englewood) CO 128
33 Residence Inn by Marriott Shelton CT 96
34 Residence Inn by Marriott Windsor CT 96
35 Residence Inn by Marriott Altamonte Springs FL 128
36 Residence Inn by Marriott Atlanta GA 160
37 Residence Inn by Marriott Atlanta (Norcross) GA 120
38 Residence Inn by Marriott Chicago (O’Hare) IL 192
39 Residence Inn by Marriott Lexington KY 80
40 Residence Inn by Marriott Louisville KY 96
41 Residence Inn by Marriott Gaithersburg MD 132
42 Residence Inn by Marriott Portland ME 78
43 Residence Inn by Marriott Detroit (Livonia) MI 112
44 Residence Inn by Marriott Troy (Madison Heights) MI 96
45 Residence Inn by Marriott Cherry Hill NJ 96
46 Residence Inn by Marriott Saddle River NJ 174
47 Residence Inn by Marriott Binghamton NY 72
48 Residence Inn by Marriott Harrisburg PA 122
49 Residence Inn by Marriott Dallas (Addison ) TX 150
50 Residence Inn by Marriott Dallas (Arlington) TX 114
51 Residence Inn by Marriott Richmond VA 104
52 Residence Inn by Marriott Richmond VA 80
53 Residence Inn by Marriott Bellevue WA 120
54 Residence Inn by Marriott Bothell WA 120
55 Residence Inn by Marriott Lynnwood WA 120
56 Residence Inn by Marriott Seattle WA 144
57 Sheraton Rockville MD 154
58 Sheraton Four Points Ft. Walton Beach FL 216
59 Stay Inn Lombard IL 128
60 Stay Inn Schaumburg IL 128
61 Stay Inn Ft. Wayne IN 80
62 Stay Inn Albany NY 126
63 Towne Place Suites by Marriott Horsham PA 95
64 Westin Morristown NJ 224
Total
8,329
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