Hersha Hospitality Acquires the Rittenhouse Hotel in Philadelphia, PA
March 02 2012 - 8:30AM
Business Wire
Hersha Hospitality Trust (NYSE: HT), owner of upscale hotels in
urban gateway markets, announced today that the Company acquired an
interest in a mixed-use building, which includes a condominium
interest in the 111-room Rittenhouse Hotel and 44,000 square feet
of retail and office space and a fee interest in an adjacent
parking garage. The total purchase price for the tangible and
intangible assets of the hotel, office, retail and parking garage
is $42.0 million. Including the anticipated renovations, the hotel
portion is valued at $23.9 million or $215,000 per key. The
Rittenhouse Hotel has historically produced the highest revenue per
available room (RevPAR) in the Philadelphia market.
“We are pleased to enhance our presence in the emerging
Philadelphia market with the acquisition of the highly rated
Rittenhouse Hotel,” commented Jay H. Shah, Chief Executive Officer.
“This AAA Five Diamond hotel boasts the largest guestrooms and the
best location in the city. The property is ideally situated on
Philadelphia’s famed Rittenhouse Square, within walking distance to
Center City’s primary corporate demand generators and its premier
retail corridor. Additionally, the hotel affords easy access to the
Convention Center and the City’s numerous arts, cultural, dining
and leisure venues. The property has consistently been the top
performer in the market, and we have identified further
opportunities for enhanced asset management, upgrades and expansion
which should improve operating margins and maximize Hersha’s
investment in the property. The revenue from the adjacent parking
garage and the income from the retail and office leases will also
provide consistent cash flow at the property.”
The hotel features the highly rated Lacroix Restaurant, an
indoor pool, fitness center, 8,500 square feet of business and
social function space and 100 underground parking spaces. Hersha
Hospitality Management has assumed management of the hotel.
Included in the acquisition is 44,000 square feet of retail and
office space. The primary leaseholders include Smith &
Wollensky, Citizens Bank, Prudential, Adolf Biecker Spa &
Salon, and Saxbys Coffee. Hersha is also purchasing the adjacent
fee simple stand-alone parking garage with 300 parking spaces.
With strong, long-term demand fundamentals and limited supply
growth, Philadelphia is poised to be one of the top five growth
markets over the next several years according to PKF Hospitality.
In addition, the Philadelphia Convention Center is expected to have
one of its strongest years in 2012.
The Company has posted a presentation of supplemental
information about the Rittenhouse Hotel acquisition located at
www.hersha.com on the investor relations section under
“Presentations.”
About Hersha Hospitality Trust
Hersha Hospitality Trust is a self-advised real estate
investment trust, which owns 67 hotels in major urban gateway
markets including New York, Washington, Boston, Philadelphia, Los
Angeles and Miami totaling 9,598 rooms. HT follows a highly
selective investment approach and leverages operational advantage
through rigorous and sustainable asset management practices. For
further information on the Company visit our website at
www.hersha.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, and, as such, may involve known and unknown risks,
uncertainties and other factors that may cause the actual results
or performance to differ from those reflected in the
forward-looking statement. For a description of these factors,
please review the information under the heading “Risk Factors”
included in Hersha Hospitality Trust’s Annual Report on Form 10-K
for the year ended December 31, 2011, filed with the U.S.
Securities Exchange Commission and the prospectus supplement and
accompanying prospectus relating to the offering.
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