Bethesda-based hospitality REIT DiamondRock Hospitality Co. has offloaded a downtown D.C. hotel it acquired in 2012.
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The 410-room Westin Washington, D.C. City Center hotel at 1400 M St. NW traded for $92M, DiamondRock announced Thursday.
Kentucky-based Columbia Sussex was the buyer, according to D.C. deed records.
“The sale of the Westin D.C. City Center marks an important step in our strategy to drive long-term earnings and cash flow per share growth and we plan to prudently redeploy the proceeds to create exceptional value for our shareholders,” DiamondRock CEO Jeffrey Donnelly said in the company's release.
The price tag comes out to $224K per room, and the deal represents a 7.5% capitalization rate on its 2024 net operating income, according to DiamondRock. It said the property's NOI last year was $6.9M.
DiamondRock purchased the Westin D.C. City Center from Blackstone in July 2012 as part of a four-property, $495M acquisition. Deed records show the Westin transaction was recorded for $153M.
A year later, DiamondRock said it was planning a $16.5M renovation at the property to be completed by early 2014.
The hotel opened in 1982 and was converted to a Westin in 2006 after undergoing a major renovation. It is the smaller of two Westin hotels in downtown D.C. The Westin DC Downtown Hotel at 999 Ninth St. NW has 807 rooms and is owned by Sunstone Hotel Investors.
DiamondRock owns one other D.C.-area hotel in its 36-property portfolio, according to its most recent quarterly filing: the Embassy Suites by Hilton Bethesda. The REIT's portfolio has a total room count of about 9,600.
UPDATE, FEB. 21, 1:15 P.M. ET: This article has been updated to include the buyer.
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