Real estate investment trust Summit Hotel Properties has closed the acquisition of Embassy Suites by Hilton Tucson / Paloma Village in Arizona, US for $25.5m.
The deal was completed through Summit Hotel’s joint venture with GIC.
Constructed in 2007, the property has 120 rooms, four meeting rooms and 4,437ft2 space for hosting events.
Other guest amenities include an outdoor pool, a fitness centre, a business centre, complimentary Wi-Fi and an on-site restaurant.
Embassy Suites by Hilton Tucson / Paloma Village is located close to La Encantada, an outdoor luxury shopping centre and La Paloma Country Club, a private club featuring 27 holes of Jack Nicklaus Signature Design Golf and others.
Summit Hotel noted that the hotel’s average Revenue Per Available Room Index was around 150% in the past five years.
The company attributed the ranking to “the property’s excellent location and dominant Embassy Suites brand affiliation”.
The Embassy Suites also benefits from year-round demand from several sources. The Tucson market generally registers strong occupancy and average daily room rate in February and March due to leisure travel.
The acquisition was funded with a mix of cash and an assumed loan that has a balance of around $13.3m.
The property is expected to generate a net operating income yield between 7.0% and 7.5% for fiscal 2022.
Besides Embassy Suites, the joint venture also owns the Homewood Suites by Hilton Tucson/St. Philip’s Plaza University, which is located less than three miles south of the Embassy Suites.
Summit Hotel’s portfolio had 74 hotels, of which 61 are wholly owned, as of 04 January 2022.