Innkeepers USA Trust Acquires Renovated Westin Governor Morris in Northern New JerseyThe lobby of the Westin Governor Morris hot
May 13 2005 - 11:42AM
Business Wire
Innkeepers USA Trust (NYSE: KPA), a hotel real estate investment
trust (REIT) and a leading owner of upscale extended-stay hotel
properties throughout the United States, today announced that it
has acquired the newly renovated 224-room Westin Governor Morris
hotel in Morristown, N.J. for approximately $35.1 million. The
acquisition will be funded by borrowing on the company's unsecured
line of credit. Innkeepers Hospitality Management, Inc. will manage
the property. Jeffrey H. Fisher, chief executive officer and
president of Innkeepers USA Trust, owns Innkeepers Hospitality
Management. "This acquisition is an example of our prudent strategy
to grow opportunistically and diversify," said Jeffrey H. Fisher,
chief executive officer and president. Innkeepers' acquisition
program targets high-quality assets in high-barrier, high-demand
markets at attractive prices. "The Westin Morristown is an upper
upscale, full-service property -- our first in this segment -- in a
high-barrier market with strong corporate demand and little supply
of comparable quality. The hotel is in top physical condition
following a recently completed, multi-million dollar renovation
that positions this property to assume a leadership role among its
competitive set. "In addition to the property's locational
advantages, including its proximity to New York, we acquired this
like-new asset at a price significantly below replacement cost,"
Fisher added. "While our primary acquisition target remains upscale
extended stay, the economics of this deal were compelling,
especially in today's competitive real estate market. We will
continue to look for opportunistic acquisitions in alternative
segments and brands in high-barrier locations, particularly hotels
that are underperforming or ripe for repositioning." The
refurbishment created an additional 10,000 square feet of meeting,
breakout and event space (for a total of 25,000 square feet), an
elegant new signature restaurant and martini lounge, a new espresso
bar and an expansive fitness center aside from the complete
upgrading of the existing spaces, structure and mechanicals. The
hotel also features all of Westin's branded signature amenities and
services, such as the Westin Heavenly Bed, Westin Heavenly Bath,
and a WestinWORKOUT Powered by Reebok fitness center, in addition
to the enhanced amenities exclusive to the Westin Governor Morris.
Peter Willis, Innkeeper's vice president of business development,
noted that the company continues to have an aggressive appetite for
hotel acquisitions, including upscale extended stay and premium
limited service brands, the core of the company's portfolio;
selected full-service properties; and turn-around opportunities and
hotels that are affiliated with, or have the potential to be
converted to, the industry's top brands. Innkeepers USA Trust is a
hotel real estate investment trust (REIT) and a leading owner of
upscale extended-stay hotel properties throughout the United
States. The company owns 68 hotels with a total of 8,521 suites or
rooms in 20 states and Washington, D.C., and focuses on acquiring
and/or developing upscale and upscale extended-stay hotels with
premium brands and the rebranding and repositioning of other hotel
properties. For more information about Innkeepers USA Trust, visit
the company's web site at www.innkeepersusa.com. Cautionary
statements set forth in reports filed by the company from time to
time with the SEC discuss important factors impacting, or that
could impact, the company and its results or forecasted results.
These factors include, without limitation, (i) direct exposure to
the operational risks of the hotel business (including decreasing
hotel revenues and increasing hotel expenses) under the company's
new taxable REIT subsidiary structure, (ii) risk that war,
terrorism or similar activities, widespread health alerts,
disruption in oil imports or higher oil prices or changes in
domestic or international political environments negatively affect
the travel industry and the company, (iii) risk that the
performance and prospects of businesses and industries that are
important hotel demand generators in the company's key markets
decline (e.g., technology, automotive, aerospace), (iv) risk that
international, national, regional and/or local economic conditions
will, among other things, negatively affect demand for the
company's hotel rooms and the availability and terms of financing,
(v) risk that the company's ability to maintain its properties in
competitive condition becomes prohibitively expensive, (vi) risk
that pricing in the hotel acquisition market becomes prohibitively
expensive or non-financeable and that potential acquisitions or
developments do not perform in accordance with expectations, (vii)
changes in travel patterns or the prevailing means of commerce
(i.e., e-commerce), (viii) the complex tax rules that the company
must satisfy to qualify as a REIT, and (ix) governmental regulation
that may increase the company's cost of doing business or otherwise
negatively effect its business or its attractiveness as an
investment and create risk of liability for non-compliance (e.g.,
changes in laws affecting taxes or dividends, compliance with the
Americans with Disabilities Act, workers compensation law changes,
the Sarbanes-Oxley law, etc.).
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