Ashford buys Westin O’Hare

Ashford Hospitality Trust has announced it has signed a definitive agreement to acquire
the 525- room Westin O’Hare in Rosemont, Illinois, for $125 million in cash from JER O’Hare Hotel, an affiliate of JER Partners.The seller was represented by Molinaro Koger. Westin O’Hare is
managed by Starwood Hotels & Resorts Worldwide under a long-term management
agreement. The acquisition is expected to close within 70 days.
  On a trailing 12-month basis, the purchase price represents a cap rate
of 6.5% on net operating income and a 12.9x EBITDA multiple. Ashford will
fund the acquisition with proceeds from its July 2006 follow-on offering
and property-level debt.
  The Westin O’Hare contains 525 rooms, 43,000 square feet of meeting
space and three food and beverage facilities. Opened in 1984, the hotel
completed a $14 million renovation in 2003 that included a complete
refurbishment of the guestrooms, lobby and a majority of the meeting and
function space. Ashford intends to invest an additional $6.1 million over
the next 24 months to further enhance the guestrooms and bathrooms with new
improvements such as soft goods and flat panel TV’s. Located on 11.5 acres,
the hotel has space for a potential expansion. The Westin O’Hare is the
only four-star, four-diamond hotel in the O’Hare submarket and boasts the
highest meeting space per guestroom ratio in the market.
  Monty Bennett, President and CEO of Ashford Hospitality Trust, said,
“Chicago is one of our targeted major markets, and we are pleased to be
able to secure what we believe is the best asset in the O’Hare submarket at
a price below replacement cost. O’Hare International Airport is one of the
world’s busiest airports, and the recent approval of a $15 billion
expansion should provide further economic stimulus to the local hotel
market. The surrounding Rosemont office and industrial submarkets create
additional diversified demand generators for the hotel. The Chicago hotel
market’s recent strengthening and momentum is far from complete with
additional gains in RevPAR expected. With its strong brand, excellent
competitive location, high ratio of meeting space and potential for future
expansion, the Westin O’Hare is poised to benefit greatly from Chicago’s
improving economic outlook.”
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