A bankruptcy judge has approved the acquisition of 69 Innkeepers USA Trust-owned hotels by Chatham Lodging Trust.
Chatham will invest a total of approximately US$232 million into the two transactions, consisting of US$195 million in an outright purchase of five of the hotels and a US$37 million acquisition of a 9.2% interest in a joint venture with affiliates of Cerberus Capital Management LP that will acquire 64 of the hotels for approximately US$1.125 billion. The price for the 64-property joint venture portfolio equates to about US$135,000 per key.The vast majority of the acquired portfolio consists of select-service brands, including 36 Residence Inns, 12 Hampton Inns, six Summerfield Suites and five Courtyards by Marriott.Completion of the acquisitions is expected in July. The deals were first announced back in May, but since Innkeepers is going through bankruptcy proceedings, they required court approval. Innkeeper’s secured creditors and more than 90% of its unsecured creditors favor the plan.Chatham President and CEO Jeffrey Fisher founded Innkeepers in 1994, with a portfolio of seven hotels.All but one of the 69 hotels in question will continue to be managed by Island Hospitality Management, a hotel management company that is 90%-owned by Fisher.The vast majority of the acquired portfolio consists of select-service brands, including 36 Residence Inns, 12 Hampton Inns, six Summerfield Suites and five Courtyards by Marriott.
