ANNAPOLIS, MD-Chesapeake Lodging Trust has closed on a $130 million three-year term loan, secured by two hotels the REIT acquired over the past six months. One is the 368-room Le Meridien San Francisco and the other is the 360-key W Chicago--City Center. Wells Fargo Bank, N.A. provided the loan, which, subject to certain conditions, provides for two one-year extensions. A call to Chesapeake was not returned in time for publication.

The loan has an interest equal to LIBOR, plus 3.65%, subject to a LIBOR floor of 1%. At the same time the loan was closed, the REIT entered into an interest rate swap to fix the interest rate at 4.65% per annum for the first two years, and an interest rate cap for the third year. The term loan allowed the REIT to take advantage of the current attractive interest rate environment, CFO Douglas W. Vicari, said in a prepared statement.

Chesapeake is using the proceeds to prepay its previous $60 million term loan and for general business purposes, including funding future acquisitions. The REIT recently raised $212.2 million through a public offering of 12.5 million common shares. It has been on an acquisition spree in recent months, with the 204-key Courtyard Washington Capitol Hill/Navy Yard one of its more recent deals. That local hotel traded for $68 million, or $333,000 per key.