NEW YORK CITY-Chesapeake Lodging Trust reported on Thursday it had closed on the purchase of the Hyatt Place New York Midtown South for $76.2 million. The same day the firm announced the official grand opening of the 185-room hotel.
The deal, which calculated out to $412,000 per key, marks the Annapolis, MD-based company's second hotel in New York City and the first Hyatt Place hotel in New York City. The firm also reports that it has reached an agreement with Real Hospitality Group to manage the hotel on West 36th Street. The seller of the hotel was not revealed.
Chesapeake's President and Chief Executive Officer James L. Francis says of the deal, “We are very pleased to acquire our second hotel in the highly desired Midtown area of Manhattan at a very compelling per key price. Similar to the Holiday Inn New York City Midtown – 31st Street, which we acquired in late December 2011 and opened for business in January 2012, we expect the Hyatt Place to ramp-up very quickly given the robust demand in Manhattan, the strength of the Hyatt brand, and our operator's extensive experience managing hotels in New York City.”
Rakesh Sarna, group president–Americas, Hyatt Hotels Corp., states, “The opening of the city's first Hyatt Place is a significant step forward in our goal to become the most preferred brand for our guests, and we can't wait to show New Yorkers and its many visitors from around the world what Hyatt Place is all about.”
Chesapeake Lodging funded the acquisition with available cash on hand; a credit at closing equal to the outstanding balance of a construction loan provided to the seller; and a $35-million advance under the Trust's $60-million term loan obtained in July 2012.
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