ANNAPOLIS, MD—Chesapeake Lodging Trust has taped the capital markets to help pay for a pending acquisition in San Francisco. This week the REIT priced a public offering of 4.2 million common shares for $126 million in gross proceeds. It will use the net proceeds from the offering in its acquisition of the JW Marriott San Francisco Union Square. The purchase price for the 337-key hotel is $147.2 million, or $437,000 per key.
Chesapeake has also entered into an agreement to sell the 153-room Courtyard Anaheim at Disneyland Resort in Anaheim, CA for a purchase price of $32.5 million, or $212,000 per key. The net proceeds of this sale will also go to funding the San Francisco acquisition.
San Francisco has become a favored location for Chesapeake – indeed many lodging companies – to make acquisitions. To cite one example, last year the REIT acquired the 313-room Hyatt Fisherman's Wharf from an affiliate of Hyatt Hotels Corp. for $103.5 million, or approximately $331,000 per key.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
