Timing markets is a challenging endeavor not easily won and in this case, the seller got a price, it just may not have been the one that was expected. The Hotel Palomar is located in Downtown Chicago. It was until recently owned and operated by Kimpton Hotels.
After the recession, the hotel saw prices rise and while business was on an upswing, the real estate investment affiliate KHP Capital Partners put the property up for sale looking to cash in. That was three years ago and since then the market has slowed and is down significantly this year.
Enter Service Properties Trust (SPT), one of the nation’s largest hotel real estate investment trusts. They are familiar with the downtown area as they also own the 221-room Residence Inn and the 334-room Wyndam Grand Chicago Riverfront hotel at 71 E. Wacker Drive.
SPT’s CEO John Murray had this to say, "We believe this is a quality acquisition in a major market at a price that is well below replacement cost and that will add long-term value to (Service Property Trust's) portfolio."
Service Properties Trust is based out of Newton, MA and owns 328 hotels and owns or leases 945 retail focused net lease properties located throughout the United States, Canada and Puerto Rico.
