CHICAGO-Locally-based Dow Hotel Co. is joint venturing with New Jersey-based Prudential Real Estate Investors to purchase the Rosemont Suites at O’Hare Airport in Chicago. The 296-room property was acquired through their joint venture, PD Hotel Associates, for an undisclosed sum. The hotel’s seller also has asked to remain anonymous. A source at Dow says the seller used Colorado-based Secured Capital Corp. to complete the transaction.

The Rosemont property (5500 N. River Rd., Chicago) was added to Dow’s portfolio “because of its great location and that fact that, hands down, it is the nicest in the area.” It is the only all-suite luxury hotel in such close proximity to the O’Hare International Airport. Dow believes it will be able to “do more with the hotel that the previous owner and management.” Murray Dow II, president of the Dow, says, “…our proprietary management and marketing programs will give the hotel a strong competitive advantage in a market that has high barriers to new competition.”

Those barriers were mentioned in Prudential Real Estate Investors’ Real Estate Outlook published at the end of the third quarter this year, in which it stated, “The good news… has been the sustained health of the US economy and the significant tightening of credit for new hotel construction.” Prudential appears guardedly optimistic about the hotel sector, which it says has “improved since the last quarter, thought it remains one of the property types most at risk at this point in the cycle. Occupancy rates and revenues per available room have increased in all market segments and supply is beginning to slow, all of which is encouraging. The close relationship between the hotel industry and the economy poses obvious risks if the economy should slow.” PREI, based in Newark NJ, is a subsidiary the Prudential Insurance Company of America. According to figures from June 30th, the REIT manages over $13.8B in assets on behalf of more than 325 institutional clients in the US, Europe, Asia and Latin America.

Seattle-based Dow says it is aggressively “seeking to acquire and manage other mid- to large-size, full-service hotels, especially those that have extensive food and beverage capabilities.” The company also manages and has ownership positions in the 308-room Sacramento Radisson and the Clarion Hotel James Madison, a 127-room boutique property in Norfolk VA.

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