"This is an exceptional opportunity to acquire a large concentration of guestrooms with significant upside potential in one of the strongest lodging markets in the nation," says Arthur Adler, managing director, Americas, of Jones Lang LaSalle Hotels. "These hotels are available for purchase as a portfolio or individually, and all are prime candidates for upbranding and repositioning." The seller is AGCCM Hotels LLC, a partnership of funds based in Connecticut and New York.
Investors are keen to develop and buy hotel properties in Washington DC for several reasons, says Amelia Lim, an associate with Jones Lang LaSalle.Hotel occupancy rates have climbed to more than 70%, and annual room rates have posted a compound annual growth rate of 4.8% since 1994.
The hospitality industry also expects to benefit from the construction of a new $750-million, 2.2-million-sf convention center, which is expected to open March 2003.
"The Washington (hotel) market had previously been constrained because of the size of the convention center," Lim says. Now it is growing, as Baltimore did when a new convention center was built there.
AGCCM's brokers are also playing up how the four hotels are all independent, without any management or franchise affiliations. "Generally speaking, a new owner wants as much freedom as possible. The less encumbrances, the better," Lim notes.
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