BETHESDA, Md. – July 28, 2021 – RLJ Lodging Trust today announced that it is under contract to acquire the fee simple interest in the newly-built, 186-room Hampton Inn & Suites Atlanta Midtown (the “Hotel”) for a purchase price of $58.0 million in cash. Upon stabilization, the Company expects the Hotel to generate an estimated 8.0% to 8.5% NOI yield.
“We are pleased to acquire this high-quality, young asset in one of the fastest growing markets in the country,” commented Leslie D. Hale, President and Chief Executive Officer. “Midtown Atlanta is a top submarket, and this property is located within the heart of demand, surrounded by significant new development activity. The addition of this hotel complements our existing portfolio, and we are confident that it will be accretive to our RevPAR, margin and overall growth profile as the property ramps up. This acquisition demonstrates our deep industry relationships and capabilities to source accretive, off-market deals. Our acquisition pipeline is growing and our strong balance sheet positions us extremely well to continue to execute on external growth opportunities.”
The Hotel was constructed as a purpose-built, high-rise Hampton Inn & Suites and opened in February 2020. In addition to 186-rooms and suites, the Hotel features a sky lobby on the top floor and a rooftop bar with outdoor patio seating and views of Atlanta’s skyline. The property is located just three blocks from Google’s new office in Atlanta.
Atlanta continues to rank as a top growth market, for both population and corporate relocations. The City is home to the third largest concentration of Fortune 500 headquarters and has a growing base of technology companies which contributed to a 60% increase in technology-related jobs since 2010. Employment and population growth trends in Atlanta are forecasted to outperform the national average for years to come.
The Hotel is located in the heart of Midtown Atlanta, which is a top submarket with one of the strongest growth profiles, within the Atlanta metro region. Since 2015, Midtown Atlanta has seen population growth that is five times the City of Atlanta and remains poised for significant future growth with major office, residential, retail expansion and development projects underway. The Midtown Atlanta submarket also has a diversified demand base with top educational institutions such the Georgia Institute of Technology, which in addition to an enrollment of over 29,000 students, is also attracting many renowned companies to set up innovation centers near the university. Additionally, as the heart of Atlanta’s arts and cultural scene the submarket benefits from strong leisure demand with 1.5 million overnight hotel stays generated annually and is also seeing significant growth from the film production industry.
The Company expects to close on the transaction during the third quarter, subject to customary closing conditions. With the acquisition of the Hampton Inn & Suites Atlanta Midtown, the Company will own five hotels in the Atlanta market.
