The deal comes at an opportune time, says DiamondRock president and COO John Williams, since 2006 is "stacking up as a potentially record convention year for Chicago and 2007 should also be a strong year. The expansion of McCormick Place is now scheduled to open in 2007, eight months ahead of schedule. With relatively few increases to supply in the pipeline and several hundred hotel rooms scheduled to be removed from the market, the Chicago hotel market has significant upside."
As a result of all of that expected activity, the firm is looking at a double-digit RevPar increase for the new lodging jewel in its collection. Upon completion of the acquisition of the Chicago Marriott, DiamondRock will own 16 hotels with 7,311 rooms. The company has an acquisition-sourcing relationship with Marriott International.
The deal is expected to close before the end of the month. In addition to the $295 million, the REIT has okayed approximately $11 million of net consideration in the form of an assumed property tax liability and other adjustments. The hotel is budgeted to generate $25.8 million of Ebitda.
GlobeSt.com will update the story during the course of the day.
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John Salustri
John Salustri has covered the commercial real estate industry for nearly 25 years. He was the founding editor of GlobeSt.com, and is a four-time recipient of the Excellence in Journalism award from the National Association of Real Estate Editors.
