MINNEAPOLIS-DiamondRock Hospitality Co., based in Bethesda, MD,has signed a purchase agreement to pay $155.5 million for the821-room Minneapolis Hilton here. The hotel, the largest in thecity, is owned by a joint venture of Greenwich, CT-based StarwoodCapital Group and locally-based Haberhill LLC. The venture boughtthe property in March 2006 for $92 million.

The contractual purchase price for the Hilton Minneapolis is$152 million. In addition to the contractual purchase price,DiamondRock has agreed to fund the seller's cost to defease theexisting mortgage debt secured by the hotel, since the company willnot assume the existing mortgage debt as part of its acquisition.The buyer expects the defeasance cost of about $3.5 million to bepaid at closing.

DiamondRock said in a statement that it has committed to make a$15.2 million deposit that will become non-refundable on June 17unless the company terminates the purchase and sale agreement priorto that date. The firm said it expects the acquisition to closeearly in its third fiscal quarter of 2010, subject to satisfactorycompletion of its due diligence review of the property and othercustomary closing conditions, including the receipt of third-partyconsents.