Summit Buys Residence Inn Near Fox, Sotherly Sees Strong Room Rate Growth At Georgian Terrace
Summit Hotel Properties offered more details on its recent deal to buy Residence Inn by Marriott in Midtown from Noble Properties.
In filings with the SEC, Summit revealed the purchase price to be $38M for the 160-room hotel just down the street from the Fox Theatre, or $237,500/key and a cap rate ranging from 8.25% to 8.75%. In turn, Summit drafted a new management agreement with Interstate Hotels & Resorts, and plans some undefined capital improvements, the firm reports.
And Sotherly Hotels' David Folsom is reporting strong RevPAR growth at its nearly renovated Georgian Terrace. David says RevPAR jumped 8.1% in Q4, driven by a 9.3% rate gain.
“With the high quality and more consistent rooms' product now in the mix as a result of our renovation, we're able to move more aggressively on rate against our competitors,” he told analysts in a recent call. Sotherly purchased the iconic 326-room Midtown hotel—right across from the Fox Theatre—back in 2014 for $61M, or $140k/room.
At the time, Sotherly reported that the hotel's room rate averaged about $136/night. It then embarked on a nearly $6M room renovation that included hardwood flooring, marble tile, and all new fixtures and furniture. Total renovations are slated for completion by May, David says.