ANNAPOLIS, MD-Chesapeake Lodging Trust has amended its $150 million revolving credit facility to an increased $200 million, with the possibility of expanding to $300 million. It secured the three-year facility with a syndicate of banks led by Wells Fargo Bank.

The facility is a cheaper source of funds for the REIT, CFO Douglas W. Vicari said in a prepared statement. "We have significantly reduced our cost of borrowing, while at the same time increased the facility size and improved the facility covenants, which will provide us greater flexibility as we manage our capital structure through the current lodging cycle," he said. Vicari was unable to return a call to GlobeSt.com in time for publication.

The REIT reports that its new interest rate is a reduced Libor plus 2.75% to 3.75%. Previously, it was Libor plus 3.75%, subject to a floor of 2%. Chesapeake’s credit management moves are timely: of all the asset classes, hotels are seen as among the most vulnerable to the temperamental economic times. At the same time, the REIT has been engaged in a flurry of acquisitions and other capital market moves.

Most recently, it closed the 613-room Denver Marriott City Center for $119 million, or approximately $194,000 per key. It funded the acquisition with available cash on hand and by borrowing under its revolving credit facility. It also recently acquired the 171-room Hotel Adagio, located in San Francisco, for $42.25 million, or approximately $247,000 per key. That deal as well was funded via revolving credit facility.

It also closed on a separate $130 million three-year loan recently, secured by the 368-room Le Meridien San Francisco and the 360-room W Chicago. Wells Fargo provided that loan at Libor plus 3.65%, subject to a floor of 1%.

Although its home is the Mid-Atlantic, the REIT has shown little preference for the area in terms of acquisition--save for one recent trade: the 204-key Courtyard Washington Capitol Hill/Navy Yard, which sold for $68 million, or $333,000 per key.