Chesapeake Lodging Trust has announced the acquisition of the W Chicago – Lakeshore in Chicago, Illinois, US, from Starwood Hotels & Resorts Worldwide for $126m.
The 32-storey, 520-room hotel features a restaurant, two bars including the roof-top Whiskey Sky, the 9,600ft² Bliss Spa, SWEAT fitness centre and over 12,000ft² of meeting and event space.
Chesapeake plans to invest $35m to $38m in a comprehensive renovation of the property, which is expected to begin in the fourth quarter 2013.
Starwood will continue to operate the W Chicago – Lakeshore under the W flag, as part of a long-term management agreement made with Chesapeake.
Chesapeake Lodging Trust president and chief executive officer James Francis said the acquisition of the lakefront hotel will allow the company to expand its footprint in Chicago.
"This acquisition further complements and creates operational and sales synergies with our W City Center property that we also purchased from Starwood in May of last year," Francis added.
Located at 644 North Lake Shore Drive, the new property is in close proximity to the Navy Pier and within walking distance of East Michigan Avenue and Chicago’s business districts.
The purchase of the W Chicago – Lakeshore was funded by Chesapeake with available cash and cash equivalents and a borrowing under its revolving credit facility.
Real estate investment trust (REIT) Chesapeake owns 13 hotels with a total of 4,036 rooms in six US states and the District of Columbia.
The company focuses primarily on investments in upper-upscale hotels in major business and convention markets, and premium select-service hotels in urban settings or unique locations in the US on a selective basis.